Amazon UK takes on Tesco, Sainsbury's, Co-op with hundreds of grocery stores
Amazon UK is planning to open more than 260 Amazon Fresh grocery stores before the end of 2024.
These will be all cashierless, tapping the e-commerce giant’s Just Walk Out technology, the company said in internal documents, according to a Business Insider report.
These state: “In 2022, we assume a broader roll-out of two store launches per week by the end of [the] year, targeting 60 total openings.”
“In 2023 and 2024, we are planning 100 store launches per year, in line with more aggressive opening programmes achieved by convenience stores in the UK in the last five years, Tesco’s, Sainsbury’s and Co-op have all exceeded 100 openings per year.”
Amazon, which has poached Tony Hoggett from Tesco to head up its international stores arm, is also reportedly looking to open a number of locations in Germany, Spain and Italy next year.
A spokesperson told RTIH: "We don't comment on rumours or speculation."
Coming soon to Holborn and Chingford
Amazon is gearing up to launch an Amazon Fresh checkout-free location in Chingford, London.
No news on the exact launch date. But we can reveal that this will be its eighth such UK convenience store to feature Just Walk Out tech.
The other six are in Camden, Ealing, Wembley Park, White City, Canary Wharf and Dalston, whilst a seventh one is due to launch in Holborn soon.
Opening hours are from 7:00 am to 11:00 pm, seven days a week.
Customers use the Amazon app to enter and put their phone away and shop for what they need. At the end of their visit, they can head for the exit, with no need to stand in a queue or check out.
“Amazon has made every grocery store in the US, and globally, obsolete”
The grocery sector’s ‘Pearl Harbor Moment’ has arrived courtesy of Amazon Fresh, according to Brittain Ladd, a supply chain consultant and former Amazon executive.
In the US, the e-commerce giant has just opened a 35,000 square foot store with Just Walk Out capability.
Something, Ladd argues that most, if not all of the major grocery retailers, including Walmart, didn't think would be possible for several more years.
“What Amazon has done is made every grocery store in the US, and globally, obsolete,” Ladd said in a LinkedIn post.
Grocery stores have operated with cashiers in their stores for over 100 years in the US, he noted.
Amazon's Just Walk Out technology removes the need for cashiers and significantly increases the speed at which customers can shop and exit the store. More importantly, it saves Amazon millions of dollars in labour costs annually in every store, providing a significant competitive advantage.
“The fact that Amazon created Just Walk Out technology is in all actuality, a massive embarrassment to Kroger, Albertsons, Wegmans, and every other major grocery retailer in the US. Amazon has only been in the grocery business since 2007,” Ladd commented.
“By comparison, Kroger was founded in 1883, and Walmart has been selling groceries in its Supercenters since 1988. The youngest player in the game has also turned out to be the most innovative.”
Unfortunately for the grocery industry, Amazon is just getting started, he continued. The pinnacle of the company’s success won't be Just Walk Out technology, it will be the fulfilment and last mile delivery network currently being implemented.
“Amazon's logistics strategy has incorrectly been described as being similar to the tentacles of an octopus. It is in fact more similar to the web of a Darwin bark spider that makes the largest spider web in the world.”
“The beauty of webs is that they allow a spider to catch prey without having to expend energy and run it down. Amazon is creating a nationwide ecosystem that in fact will operate similar to a spider web. Amazon's strategy isn't to run down the competition, it's to attract more prey - customers.”
Ladd concluded by imploring Amazon to ditch Whole Foods (“it has no value to Amazon. Zero.”)
And it should accelerate the opening of Amazon Fresh stores.
“Between 2027 and 2030, Amazon has the potential to sell more groceries than Kroger. Between 2030 and 2035, it has the potential to sell more groceries than Walmart. Think it can't happen? Think again.”
