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Loblaw partnering with Instacart on home delivery

Loblaws, Real Canadian Superstore and T&T banners in Toronto and Vancouver will offer the home delivery service

Loblaw Companies Ltd. says it will bring home delivery services to two of the country's biggest cities in the next several months.

Loblaw is partnering with California-based Instacart to deliver food and other pantry staples from Loblaws, Real Canadian Superstore and T&T locations to customers in Toronto starting Dec. 6 and Vancouver starting in January.

"We are a customer-led company adding new ways to make shopping easier," said Galen G. Weston, Loblaw CEO, in a statement.

Both moves come as retailers face increasing pressure on several fronts including discount retailers such as Walmart, online retailers such as Amazon and minimum wage increases in some provinces.

Amazon's acquisition of Whole Foods, including its 13 Canadian locations, increased speculation that Canada's grocers would have to step up on home delivery offerings.

Read: How the Amazon, Whole Foods deal could impact Canadian grocery

To date, Canadians have few options for grocery deliveries with companies like Grocery Gateway and select large chains offering the service in limited locations.

Walmart announced in March it would start delivering groceries to customers living in certain parts of Toronto and the surrounding area. Shoppers must purchase at least $50 worth of food before taxes and pay a $9.97 fee.

Most grocers, including Loblaw and Walmart, have opted to focus on in-store pick-up for online orders instead. Loblaw launched its click-and-collect offering in 2014 and it's now available at nearly 200 locations.

The home delivery announcement came Wednesday as Loblaw reported it more than doubled its third-quarter profit compared with a year ago as its results were boosted by the sale of its gas bar business. The grocery retailer also said it had finalized a plan that will result in the closure of 22 unprofitable stores across a range of its banners and formats.

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