retail news in context, analysis with attitude

Amazon got a little more specific about its future grocery store plans: it plans to "open a new type of grocery store in Los Angeles next year, another step in the e-commerce giant’s multi-pronged effort to capture a larger piece of the massive U.S. grocery business."

But - the new stores won't have Amazon Go-style self-checkout systems, according to the company, which is not saying what the stores will have.

The first store, it confirmed, will open in Woodland Hills, and will "be distinct from Whole Foods Market Inc., the higher-end chain Amazon bought in 2017 that specializes in natural and organic groceries." The Wall Street Journal reported recently that Amazon has secured more than 12 leases in the L.A. area, as well as in Chicago and Philadelphia.

The Times writes that "analysts said that although Amazon, as usual, was keeping it strategic aims close to the vest, the company undoubtedly is learning how it can bring innovation to grocery shopping just as it did with other consumer goods."

Burt Flickinger III of the Strategic Resource Group tells the Seattle Times that he believes that Amazon is poised to “turn the Whole Foods model inside out by going from the highest-priced retailer in the modern world to the lowest-priced for grocery food retail."

He tells the Times that he "expects Amazon to open 10 to 12 grocery stores in 2020 before pursuing a regional and then national expansion in the early part of the next decade that could eventually surpass 1,000 stores. By his firm’s estimates, Amazon’s share of the $1.4 trillion U.S. food retail business could grow from less than 2% now to as much as 10% by the end of the next decade."
KC's View:
I have no doubt of Amazon's ambitions. I have even less doubt of its ability to achieve them.

It is possible that it will not be applying Go-style technology to a larger format because the tech just isn't ready yet. Or, it is possible that it thinks it just doesn't make sense.

However, I still think that Amazon will be applying one or more of its secret sauces - Prime, Subscribe & Save, or something else - to the new format. It'd be a shame if it didn't.