Amazon to Shut Fresh and Go Stores in the US as Whole Foods Expands

With over $150 billion in gross sales and more than 150 million, Amazon is one of the top three grocers in the United States. Consumers are increasingly gravitating towards online deliveries for day-to-day needs. Hence, Amazon is making efforts to streamline the online selling of household essentials and groceries. Amazon Fresh & Go took the responsibility of handing fresh groceries to the consumers initially, but recently, due to a change in Amazon's grocery strategy, the organization is shutting down the Amazon Go and Amazon Fresh physical stores. The efforts are being redirected to Whole Foods Market. This blog aims to explain the steps taken by the online sales channel and its effects. 

What Are Amazon Fresh & Go Stores?

Amazon Fresh is primarily a grocery delivery and online shopping store for daily-use items that operates in both physical and online modes. Customers could order groceries through the Amazon App or website under this and have them delivered to their respective locations. Also, across many locations in the US, Amazon opened dedicated supermarket-style stores for shopping for groceries, meat, dairy, and other staples.  

Amazon Go, as the name suggests, is a quick convenience store opened by the company in different locations to provide daily-use products like snacks, drinks, and ready-to-eat meals.  With Amazon cashierless stores, consumers can simply pick up their favourite products and check out at the counter without any delay. 

Why Amazon Is Closing Fresh & Go Stores?

Amazon Go and Amazon Fresh might sound really useful for consumers and profitable for the company, so why the shutdown? Here’s a list of reasons for the shutdown:

1. Expensive Business Model

The business model providing daily-use items is expensive and is not able to produce relevant profits. So, scaling this particular business is becoming increasingly difficult for Amazon. Even the customer experience provided by the store is nothing compared to Amazon’s service. 

2. Focus on Whole Foods Market 

Amazon is laying special emphasis on Whole Foods Market expansion, hence working on the opening of over 100 new stores. The marketplace believes that Whole Foods Market can produce better outcomes in comparison to Fresh and Go markets. 

3. Same Technology Different Platform

The cashier-free technology developed by Amazon is a great one that allows customers to have quick and seamless service. But the same automation can be used for different business models to produce better outcomes, hence Amazon Fresh and Go are being closed. 

Why Amazon Is Doubling Down on Whole Foods?

Along with the shutdown, Amazon is laying special emphasis on the expansion of the Whole Foods market. Here’s a list of reasons: 

• Since 2017, Whole Foods Market, a pioneer and leader in natural and organic foods, has experienced significant success. 
• It is growing its sales by more than 40% and expanding to more than 550 stores.
• Record-breaking consumer traffic and year-over-year comparative store growth that is exceeding the industry as a whole show that customers are increasingly choosing Whole Foods Market for both regular shopping and special occasions. 
• Hence, Amazon intends to invest in the opening of over 100 new Whole Foods Market locations over the coming years in order to accelerate this expansion.

What’s Next for Amazon’s Grocery Strategy?

When there is a decision, there will definitely be effects. Following is the list of the same: 

1. Wider Access and Convenience

With Whole Foods Market expanding to wider areas, customers get easy access to fresh produce and daily need items. Also, they can have everything from a single source, without having to look for multiple stores or outlets. 

2. One-Stop Shop

Whole Foods, its own online grocery store, and common household items are all being combined by Amazon into a single, smooth, fast delivery service. So, there is no running from one store to another. 

3. Faster and Efficient Delivery 

Customers will not even have to visit the store; they can easily get their order delivered to the doorstep. Even on days when you don't feel like going to the store and getting stuff, Amazon’s network will deliver effectively. 

4. Technology Driven Experience 

This step of Amazon is going to provide the consumers with a tech-driven experience where they do not have to deal with a cashier as they enter the store. Also, doorstep delivery of goods is going to help consumers simplify their day-to-day lives. 

Conclusion

Amazon, as a sales channel, is focusing on diversification and trying out new ventures to provide the best services to its customers. Now, as a seller, it's your turn to provide the best service to your customers, and for this, automation software is the best option. Just like Amazon’s cashierless technology, go error less and process all your orders effortlessly without human intervention. With applications like MapMyChannel, go ahead and automate and integrate your business with the best solution provider. Follow the footsteps and work on what’s best for the business.