“While we wish it weren’t so,” opens the message greeting e-consumers logging on in Houston and San Diego, “Kozmo.com will no longer operate in your area. Unfortunately, demand did not match our staffing and inventory requirements to maintain service.”

The online grocery e-delivery service reported that while the average order nationwide reaches US$28, in Houston and San Diego it falls US$4 short of economic feasibility, at US$24.

Spokesman Matt Higgins commented in TheStandard.com: “Kozmo is no different than a traditional retailer and continually evaluates under performing markets. We decided to close those markets and focus on our more mature markets.”

The closure of this branch of Kozmo operations has meant that 130 employees have lost their jobs, 120 in the two cities and 10 in the company’s New York headquarters.