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Amazon plans convenience stores for online food shoppers, report says

October 11, 2016 01:03 PM
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(Bloomberg)—Amazon.com Inc. is planning to build convenience stores and develop curbside pickup locations for food shoppers in its latest move to expand into groceries, The Wall Street Journal reported.

Amazon’s stores will sell perishable goods including milk and meats, the newspaper said, citing unnamed sources. Customers in the stores can also order other items with longer shelf lives for same-day delivery, the Journal said. The Seattle-based e-commerce giant will also build drive-in locations for consumers in a rush where online grocery orders will be brought to the car. Only subscribers to Amazon’s Fresh service will have access to these stores, known as Project Como.

Amazon representatives didn’t immediately respond to a request for comment. Amazon is No. 1 in the Internet Retailer 2016 Top 500 Guide

The grocery stores represent Amazon’s latest move to disrupt bricks-and-mortar food shopping that’s still dominated by traditional retailers such as Wal-Mart Stores Inc. (No. 4 in the Top 500). While Amazon has dominated in e-commerce, convincing customers to shop online for everything from toiletries to electronics, it has yet to crack groceries—which most consumers still buy offline. Previously, Amazon had focused on fresh food deliveries rather than establishing a physical presence but it’s encountering increased competition from Google, Instacart and others.

Wal-Mart, whose main selling point has been its physical reach, started a grocery pickup service more than a year ago and has now expanded it to more than 100 markets. Customers can purchase online, drive to the parking lot of a Wal-Mart store and have their orders delivered to their cars. Even as Amazon uses the Fresh grocery service and Prime membership to keep customers loyal, Wal-Mart is trying to create a better online experience.

 

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