Andy Jassy, Amazon’s CEO, has reiterated that the company will come up with a viable retail grocery format this year that it can deploy on a large scale. Jassy said an interview with the Financial Times. “We’re hopeful that in 2023, we have a format that we want to go big on, on the physical side”. According to him, Amazon is still in the early stages of developing its grocery concept. Recently, Amazon announced that it would halt the expansion of its grocery stores and convenience stores, along with shutting down some locations, while it redesigned the format of those stores. According to Jassy, the fact that many of its stores open during the pandemic has hindered the company’s efforts to develop them. Additionally, Jassy and other Amazon executives stated during the company’s recent fourth quarter earnings call that they remain optimistic about the company’s prospects for operating physical grocery stores in the future.
When Amazon acquired Whole Foods Market in 2017, it gained a large national footprint in retail food, however its Fresh format was viewed by consumers as a more mainstream alternative. In recent years, both Amazon Fresh and Amazon Go have been widely viewed as potential disruptors of food retailing, but neither concept has been able to meet expectations. Its stores are similar to traditional supermarkets, offering private labels and cutting-edge technology such as Dash Carts that allow customers to bypass checkout lines by scanning products as they shop. Unlike traditional convenience stores, Amazon Go stores offer a limited selection of grab-and-go items. These stores use Amazon’s patented Just Walk Out Technology, which allows shoppers to shop and pay without scanning their purchases.
It is estimated that Amazon’s physical stores will generate about $19 billion in sales in 2022 (not including orders placed online for pickup or delivery). The company currently has 44 Amazon Fresh locations and 29 Amazon Go stores in the U.S., according to its website. It is estimated that the number of physical stores will increase about 11.1% in 2022 to approximately 44.
Alexis Boutilier is from Vancouver, British Columbia. She has a high interest in all things tech and loves to stay engaged on all the latest appliances and accessories.