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MNB has learned that has decided to liquidate its online grocery inventory, selling all the merchandise in its New Jersey warehouse as its president, Lisa Kent, negotiates with companies interested in acquiring the company. Sources characterized the negotiations as "heated," with a strong likelihood that at the very least, one of several companies will sign a letter of intent and start the due diligence process.

As the company liquidates its inventory, it has virtually shut down its NeXpansion "endless aisle" service, which was "a provider of turnkey technology and fulfillment solutions for manufacturers and retailers and the founding company of, offers retailers an increased selection of products – either online or via in-store kiosks – to help build and sustain consumer loyalty."

The problem, sources tell MNB, was a simple lack of investment capital to keep the company afloat.

Among the retailers that were using the "endless aisle" product under a variety of names were Delhaize America, Weis Markets, Lowes Foods, Shaw's, Pathmark, Winn-Dixie and Ahold USA. Harris Teeter, in fact, had just announced its use of the service back in early September.

Manufacturers that were working with NeXpansion and NetGrocer to make hard to find items available via the Internet included Kraft, Nestle, Quaker, Mott's, Kellogg's, Campbell's, Gerber, Johnson & Johnson, and Colgate-Palmolive.

Kent told MNB that retailers and manufacturers had generally been "sympathetic and understanding, considering the retail environment as a whole." However, she would not comment on reports that NetGrocer and NeXpansion were in "heated negotiations" with potential buyers.
KC's View:
One window closes, and another one opens…

We've always thought that NetGrocer and especially the NeXpansion "endless aisle" concept were apt uses of Internet technology. NetGrocer had managed to hang in for a long time even while other online grocery services were collapsing, and deserves a lot of credit for survival instincts; the "endless aisle" product, it seems to us, is exactly what the Internet was made for, and it would be a shame if this product were to disappear.

We would think that it makes a lot of sense that, whoever is interesting in buying NetGrocer, some sort of approach be made to to find a way to work together and broaden Amazon's already impressive food product offerings. NetGrocer certainly has the infrastructure, and even a small customer base that could jump-start the Amazon food business.

It sounds like what is happening now is that investors that may have been leery about investing in NetGrocer may now be intrigued by the notion of buying the entire company. They may have gotten just a percentage of the business for X number of dollars before, but now could be able to get the whole thing for the same amount of money.

We hope that NetGrocer's options remain open as it liquidates product and seeks a buyer. It remains a good idea in a tough and unforgiving marketplace.