How Much is Instacart Really Costing You

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You may have gotten grocery delivered to your home by Instacart, but do you know exactly how much the Instacart markup is on the goods? It may be more than you think!

Grocery delivery – sounds like a dream come true, doesn’t it? You don’t have to deal with screaming kids in the shopping cart, threatening to jump out any time you turn your back to grab something off the shelves. You can shop for groceries right on your phone or computer while the baby naps or even shop ahead of time and schedule the delivery the next day. I was a huge fan when Amazon Prime Now came online and used it plenty for Sprouts. Then when Costco started offering same-day delivery services with Instacart, I was over the moon!

What is Instacart?

In case you are not familiar with Instacart, it is an online grocery delivery service company that partners with local stores to deliver groceries to your door. After you place your order, the items can be delivered to you as little as within 2 hours of you checking out. Instacart has a team of shoppers who will go out to the stores and shop your groceries for you (they might do multiple orders at the same time), and after they are done, they will deliver to the respective homes.

How much is Instacart charging for its services?

Before I get into how much extra Instacart is costing you, I want to say that I understand Instacart and its shoppers need to make money. After all, you are paying for the convenience of having grocery showing up at your doorstep versus wrestling with your kids to get into their car seats. Plus, Instacart does have a disclaimer on the website saying that the prices in the online store are indeed higher than the local stores. However, I did not really comprehend exactly how much extra I was paying until one of the shoppers accidentally gave me her receipt from Costco.

First, I didn’t know that the shopper wasn’t supposed to give you the paper receipt. My shopper gave me the paper receipt because she started carrying items that I didn’t order into my house and I wanted to make sure I was getting exactly what I ordered. Honestly, I have ordered from Costco using Instacart so many times I lost count and I never thought about how much more I was paying. I assumed I was paying a little more, but so worth the convenience plus gas money. It wasn’t until I got the paper receipt that I noticed that the total was nearly $20 less than what I paid online.

Here is a breakdown of the items I purchased and the markups:

25% markup is quite high! Again, I understand they have to make some money to pay the shoppers, but Instacart always markets themselves as being able to SAVE people money. For Costco, they have the same discounts as the ones you would see in the Costco warehouse. Therefore, you are not saving money by using Instacart versus going to the warehouse.

Instacart does have certain exclusive deals such as this one:

However, since you are paying an average of 25% markup, it doesn’t make sense for you to stock up to save that $5. You would be only saving about 17% if you get $5 off $30, and most likely you will go over the minimum to get the discount, so overall you are paying more instead of saving. Therefore, don’t be fooled by Instacart’s marketing ploy enticing people who want to save – even with the coupons and deals you are still paying more.

I contacted Instacart to double check on the prices. This is their reply:

I apologize that you received the paper receipt with your delivery.

Really? I mean, that reply just makes you sound so shady, like you are trying to hide the actual prices because you don’t want us to know the markups you are charging.

The refund policy(Careful what you buy!)

Here is the policy when you want to return items at Costco:

For perishables: Contact Instacart if you are not satisfied with your perishables. I have gotten rotten fruits a couple of times and Instacart gave me a refund for those items.

For non-perishables: Pay attention to this one. Costco will refund you THE PRICE YOU WOULD HAVE PAID AT THE WAREHOUSE. Since the markup goes to Instacart, Costco will not be able to provide you with a refund for the service and delivery fee. Therefore, you better be sure you want what you ordered, or else you will be losing 25% of the purchasing price when you return the item at your local warehouse.

Is Instacart worth it?

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The answer is … depends. If you are a new mom, for example, and you have a colicky newborn who cannot stand car rides or needs to nurse all the time, then yes, it’s worth it. It’s like that commercial where you conclude that avoiding pulling out your hair because your kids love to throw tantrums in middle of a grocery store is priceless. Grocery delivery services really is a life changer when you are in a situation where going to the store is not an option.

However, if you can drive to the store or have your husband help with shopping, going to your local store will save you a lot more money. Or at least you won’t be paying that 25% markup.

Before I go, I want to note that if you are an Amazon Prime member, getting delivery from Amazon Fresh and Whole Foods is a great option. This is what we have been doing to avoid the Instacart markups. Sure, buying in bulk from Costco can usually save you money, but when you add in the markups, Amazon Prime is the cheaper choice.

How much are you willing to pay for convenience?

16 thoughts on “How Much is Instacart Really Costing You”

  1. I am sure that stores who showed an 8% profit last year like Publix can well afford a del service rather than giving that addt”l charge to their customers. 25% is alot. If insta cart is a 2 billion business, why don’t they pay their delivery people enough money that a tip is optional .
    this is definitely not a very inexpensive service

  2. Thank you for writing this. We have been using Instacart to shop Costco lately and noticed it was a significant markup. Haven’t run all the numbers but seems like it’s about 25%. For how much we order we lose money, but I suppose for others who don’t have the time or don’t order a lot it could be worth it. Personally I’d be ok with 10-15% markup, but 25% is too much.

      1. I calculated the markup for Costco’s cooked spare ribs is 42% according to the price tag on the cover. The extra fee of my last Costco’s Instacart service is nearly 35%. I am not only disappointed at Instacart but also at Costco,, I felt I was being cheated. So no more Instacart and Costco. I am much happier with Amazon Prime and Whole food or curb side pickup of other supermarkets.

        1. Wow I wonder if they increased the markup recently because everyone is ordering these days? That’s horrible. I understand they are providing a service but that’s a lot of money for food. Buying in bulk doesn’t make sense in that case. I agree with you that Amazon Fresh or Whole Foods is the way to go!

  3. Thanks for the article. I was thinking the markup had to be at least 20-25% to make sense. If someone’s order is $100, they only make $25 gross revenue. The shopper has to go to the store, shop and then deliver to your house. If I go to Costco, it’s usually a 2 hour affair give or take. So it seems like the shopper doesn’t do that great, although I usually order about $200.. I currently have some $15 off coupons to apply, so that makes it a bit easier to swallow, especially during the pandemic. I find that even with the markup, the prices for Costco seem reasonable compared to local stores like Sprouts or Ralph’s.

    1. These days, I am very appreciative of the shoppers that put themselves at risk to deliver us groceries. It does give me heartburn though when I order $400 worth of groceries and know the markup is probably $100 (ouch!). Unless I want something specifically from Costco, I now order from Amazon Fresh because you can get free delivery if you have Prime. It would be expensive to order from Sprouts because they also use Instacart so you get the higher prices (since no bulk) plus markup!

  4. I ordered yesterday using Instacart from Costco and accidentally the guy left receipt along with items ordered. I paid $380 for $287.76 worth of items. No issues with service OR overall ease of use however I have big issue with transparency . I though I am paying $9 for delivery & $18 for Service Fee Plus additional tip. I wrote to instacart customer service and here is response :
    ——————————>
    Instacart works with our retail partners to offer customers the same prices as those found in the physical store as much as possible. However, some retail partners choose to set their items at a higher price point on the Instacart platform than what they offer in store. That’s why you may see a price difference while shopping.
    ——————————–>
    The receipt says $287.76 so I don’t know why instacart puts it on retail store (Costco) , it is instacart which is charging these additional marks . Also , they added additional $4 for picking up Lamb (special handling). I have no problem as long as they are transparent in their pricing however this is plain cheating.

    1. I agree completely. The lack of transparency was what really bothered me as well. If you are going to charge an arm and a leg for your service, then say it and let us decide whether or not we will pay for it. But instead, they seem to want to hide the receipt, and like you said, blame the store for it.

  5. And that shopper who gave you the receipt and you reached support(which does nothing at all they still do the same thing) is now FIRED!
    She was probably new and didn’t know any better but now shes out of a job

    1. Like I mentioned above, 1) she gave me items that I didn’t order and that’s why I asked for the paper receipt. If I didn’t point that out and just accepted all these items I am sure she would have gotten in trouble anyway. 2) I didn’t call customer service to tell on her. I called because I was super confused about the prices. I thought I pay the same price as Costco plus some handling fee, I did not expect all the prices to be marked up.

  6. This happened to me yesterday. The shopper who dropped off $229 of groceries inadvertently left the receipt. I noticed we were missing an item. As I checked off the receipt I too wondered why I had an extra $51 charged on my card. I understand the delivery fee, tax, service fee and tip, but the total amount for just the groceries went from $229 to $280 with no explanation. I called to let them know I was missing an item and questioned the $51 charge for what they deemed markups by Costco. She told me to read the generic blurb but It was clear looking at the receipt that Instacart did not pay Costco any more than the $229. I questioned this and demanded my money back. I was told I would get a refund in 4 increments ($20,$20, $11 and the cost of the missing product.) Weird. It is called the Happy Client Refund. I am sorry if someone lost their job, but this is unethical. I too will continue curbside and delivery from my local grocery stores. No more Instacart!

    1. Wow I am surprised they agreed to give you a refund! I am glad you were able to get some money back. I have not heard of the Happy Client Refund. For the most part, I am using my Amazon Prime membership and getting food from Whole Foods or Amazon Fresh. Even with the expensive Whole Food’s expensive prices, it’s still worth it in comparison to the markup from Instacart.

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