Instacart Startup new tie up slashed grocery delivery charges in San Francisco and LA
Instacart is an internet based online grocery delivery service. It delivers grocery to the doorstep in under an hour. It has recently taken the decision to cut pays of the couriers who shuttle the groceries between different cities.
It has been one of the many startups trying to curb spending in a tightened funding environment in the Silicon Valley. Instacart workers in San Francisco and Los Angeles will not have to make triple the amount of deliveries to earn the same payment as earlier. It is also reducing the commission that it pays to the drivers. But the company affirms that its workers could still earn $18 to $20 dollars or even more for every hour that they work.
It is making these decisions to avoid the financial blunders that the other previously successful dot com companies had made. It is slashing pay cuts for the couriers as much as 63%. The startup is currently valued at $2 billion. Instacart has drawn funding from Sequoia Capital and Andreessen Horowitz. It has employed contract employees who do the shopping and then the drivers deliver it to the people’s doors.
This move will go on to affect people across seventeen markets in the United States. In December, the company had hiked its fee for customers and also lay off several employees to contain the workforce better. This move has been subjected to a lot of criticism from people who believe one must stand up for the workers’ rights, while others who deem it as necessity being financially sound on the lookout for the deteriorating startup environment.