Walmart's new gas-and-grocery hybrids could become a major threat to Amazon and Kroger

Hayley Peterson

Dec 3, 2016, 04:07 IST

Walmart is opening a new kind of gas station that offers more than just coffee, snacks, and fuel.

The convenience stores, called Walmart Pickup and Fuel, also offer same-day pickup for groceries ordered online.

There are only two locations right now - one in Huntsville, Alabama and the other in Thornton, Colorado - but if expanded, they could make Walmart an even bigger threat to companies like Amazon and Kroger that are betting big on the growth of online grocery shopping.

Walmart

Walmart's new Pickup and Fuel store in Thornton, Colorado.

The new stores offer grab-and-go items, including hot sandwiches, healthy snacks, drinks, and a coffee bar, as well as basics like milk, eggs, and bread, according to Walmart. They are open from 5 a.m. to 11 p.m. daily.

For a wider selection of grocery items, online grocery pickup is available at the stores between 8 a.m. and 8 p.m. Customers can order groceries before 1 p.m. and pick them up that same day, after 5 p.m.

Walmart employees pick and pack the groceries at a nearby Walmart supercenter, and load them into customers' cars at the Walmart Pickup and Fuel for free.

Walmart already offers online grocery pickup at hundreds of stores. But this new store concept is meant to make that process easier and more convenient, thanks in part to the small size of the stores and parking lots.

The concept sounds eerily similar to a new kind of store that Amazon is planning to launch.

Amazon has plans to roll out 20 grocery stores by the end of 2018. The stores will have different formats, but half of them will likely be "click-and-collect" drive-up spots for Amazon customers to pick up their online orders - just like Walmart's new Pickup and Fuel stores.

The other half of Amazon's new stores could look like miniature versions of traditional grocery stores.

Kroger has also been investing heavily in online grocery. The company offers online grocery pickup at more than 500 stores. But unlike Walmart, Kroger charges a fee for picking up online orders, which is about $4.95 per order in Richmond, Virginia.

Disclosure: Jeff Bezos is an investor in Business Insider through hispersonal investment company Bezos Expeditions.