- Instacart’s vice president of operations, Mike Swartz, has resigned after just over a year with the company, according to Progressive Grocer. The publication did not know reasons for his departure.
- Prior to being hired at Instacart in February 2016, Swartz worked in operations with Amazon and with Folica Inc., a cosmetics and beauty retailer.
- Swartz’s departure follows a series of distractions for the company, the most recent being last week’s $4.6 million settlement of a class action lawsuit brought by workers who claimed 18 violations by the company, including “improper tip pooling and failure to reimburse workers for business expenses.”
It hasn’t all been bad news for Instacart lately. Last month, the e-commerce provider secured $400 million in financing after receiving a valuation of $3.4 billion. Since January 2016, the company has nearly doubled the number of markets in which it operates — from 18 to 35 — and has added Publix, Ahold Delhaize and Schnucks to its network of retailers.
Still, distractions continue to plague Instacart at a time when it can ill afford them. The class action lawsuit settlement capped months of poor relations between the company and its workers. Pay cuts, a confusing tipping tool, reimbursement of business expenses and job classification are just a few of the issues that workers took issue with, and that ultimately spurred them to take legal action.
The departure of Mike Swartz may not be a similarly self-inflicted wound, but it nevertheless comes as an unwelcome development. Instacart has a very intricate business model that relies on pleasing retailers and shoppers as it takes away margins from an already margin-starved industry. The operations side of the business needs to keep Instacart’s technology, logistics, workers and retail relations all working in harmony with one another. Even a small hiccup can dramatically impact the business.
At the same time, Instacart has announced a slew of promotions in marketing, retail relations and corporate finance, and will no doubt fill Swartz’s position soon. Speed is imperative as more and more grocers add e-commerce capabilities, and as direct competitors like Shipt and Postmates continue to add accounts.