H-E-B the new Amazon? Grocery giant acquires food-delivery company Favor with eye on digital sales


HOUSTON – Following in the footsteps of Amazon’s Whole Foods purchase, the Texas-based grocery giant H-E-B purchased a home-delivery service company on Thursday. 

H-E-B acquired Austin-based Favor Delivery, which distributes restaurant meals and groceries via a mobile app. 

H-E-B did not release the details of the transaction, but said the effort is designed to "accelerates (the company's) path to become a digital retail industry leader in Texas," as well as give customers choice in shopping and paying and receiving goods, particularly online. 

“I am thrilled to have H-E-B join forces with another well-respected and innovative Texas company,” said Martin Otto, H-E-B’s chief operating officer. “…Over the past two years, we have established a strong working relationship with Favor that has proven to be immensely successful for both companies. We see a unique opportunity with this partnership to support and accelerate each other’s growth through the sharing of experience, insight and resources.” 

Favor will continue to independently operate their business as a separate brand. H-E-B will acquire all of Favor’s employees and its 50,000 runners, who operate as contract delivery drivers.

“It is our intent to continue to grow Favor just as it is our intent to grow H-E-B,” Otto said. “We’re very excited about this because of the opportunities it will afford both companies to better serve our customers.” 

A joint news release issued by H-E-B and Favor says “this combination will provide Texans with an innovative, convenient and world-class home delivery experience.”

H-E-B operates 400 stores in Texas and Mexico.