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H-E-B’s new Austin leasing shows it means business in digital retail market

Posted at 12:26 PM, Sep 06, 2018

Texas mega grocery chain H-E-B’s recent announcement of a new facility and innovation lab in East Austin shows its intent in battling companies like Amazon in the emerging digital consumer marketplace.

H-E-B acquired Favor in February as its first big move. Wednesday’s announcement of developing a world-class technology lab is the next step in building the company’s footprint.

The company’s familiar tagline is “that no store does more.” Developing its digital infrastructure is another way to tap into those customers.

H-E-B announced Wednesday it is leasing an 81,000-square-foot facility in East Austin. It will redesign a renovated industrial warehouse for a 2019 completion.

“This state-of-the-art space will be a hub for creativity and innovation as we continue to develop the ultimate digital experience for our customers,” Jag Bath, H-E-B’s chief digital officer and Favor CEO and president, said in an H-E-B news release. “Bringing H-E-B and Favor closer together will allow us to promote collaboration between our two companies as we strengthen our commitment to building out H-E-B’s omnichannel services.”

H-E-B now operates 400 stores in Texas and Mexico and has sales of $25 billion. It was ranked as the nation’s sixth-largest grocery chain by Statistica in 2017 sales.

The innovation lab will likely be a key to help boost the chain’s aggressive expansion into its H-E-B Delivery and Curbside services, as are in seen in a couple of Corpus Christi-area locations. Texas Monthly reports the company currently has the services available in more than 145 stores in the state with plans to expand to 165 more this year.

Obviously, H-E-B’s acquisition of Favor should help in the expansion.

Favor already is helping deliver food to consumers across the Coastal Bend through its innovative app.

Who knows?

Maybe Creamy Creations ice cream and Cafe Ole coffee might be next?