Huge possibilities for brick and mortar stores

Exterior of Whole Foods Market grocery supermarket
Exterior of Whole Foods Market grocery supermarket in Buffalo, New York. Amazon is planning more brick & mortar stores with another (unknown) brand name.
By Reidar Molthe

19 November 2019 10:00

Huge possibilities for brick and mortar stores

In these columns we have discussed a great deal about digitalization and e-commerce - a mega trend. Of course, that doesn't mean it's “the end” for traditional stores. A good example is probably that the “online ruler,” Amazon, is stepping up its focus on brick & mortar grocery stores in USA.

Amazon in brick and mortar

  • Amazon is opening a new grocery store in California next year that would be separate from Whole Foods, the company confirms.
  • The confirmation comes after The New York Times reported that Amazon is looking into creating a new grocery chain that would combine the aspects of online and traditional shopping.
  • The new store opening next year will also be separate from Amazon Go, the company's grab-and-go cashier-free convenience stores.

Amazon on Monday 11 November 2019 said it plans to open its first new brand of grocery store in California next year, as it ramps up its ambitious push to become a bigger name in food.

The planned store is separate from Whole Foods, which Amazon acquired for $13.7 billion in 2017, writes Ben Fox Rubin in CNET.

Amazon do not reveal the brand name of the planned store, whether it will open more stores or what its selection or pricing will be. But in the job advertisement, the company describes the Woodland Hills location as "Amazon's first grocery store," suggesting that it will have the Amazon brand name and that the company could expand to multiple sites.

Conventional grocery stores

The store won't use the company's Amazon Go technology, which allows customers to check out without waiting in line. Instead, checkout will be conventional as at other grocery stores, the company says.

In addition to Whole Foods with more than 500 stores, the company offers grocery delivery through Amazon Fresh, the main Amazon website and Prime Now, as well as food at Amazon Go.

Growing ambitions in the grocery market

The new store, with only one confirmed location, points to Amazon's growing ambition in the roughly $800 billion US grocery market, where rival Walmart is the leader and Amazon, even after its Whole Foods deal, remains a small player.

The new line could let Amazon move into the more mainstream grocery store business, while maintaining Whole Foods as a higher-end store for organic and specialty foods. This could offer new competition to Kroger, SuperValu and many other supermarket chains.

“When it comes to grocery shopping, we know customers love choice, and this new store offers another grocery option that's distinct from Whole Foods Market, which continues to grow and remain the leader in quality natural and organic food,” an Amazon spokesperson says, noting that Whole Foods opened 17 locations this year and that more are planned.

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