Amazon’s homegrown grocery shops are getting shelved.
The corporate stated Tuesday morning that it’s closing all of its Amazon Go and Amazon Recent places, a complete of 72 shops nationwide, concentrating its efforts as an alternative on its Entire Meals Market places and grocery supply from Amazon.com.
The transfer follows a decade of experimentation and enlargement in Amazon-branded grocery and comfort shops. Regardless of “encouraging indicators,” Amazon stated it wasn’t in a position to create “a very distinctive buyer expertise with the best financial mannequin wanted for large-scale enlargement.”
The ultimate day for many Amazon Recent and Amazon Go places will likely be this Sunday, Feb. 1. California shops will keep open 45 extra days as a result of state labor notification necessities.
In a publish saying the information, Amazon forged the transfer as a strategic shift, not a retreat from grocery, citing the expansion of Entire Meals and same-day supply for perishables.
The corporate framed its bodily grocery investments as a studying expertise, saying it has “gathered helpful insights about what issues to clients” all through the method of working the Amazon Recent and Amazon Go shops.
All 57 Amazon Recent and 15 remaining Amazon Go shops will shut. A restricted variety of Amazon Recent shops are anticipated to finally reopen as new Entire Meals places.
Amazon didn’t disclose the overall variety of workers impacted. The corporate is working to put employees in different roles, together with in its success and operations community. It’s providing 90 days of full pay and advantages as a part of its severance package deal.
Finish of an period
With the closures, Entire Meals will develop into Amazon’s solely bodily retailer model within the U.S., a decade after it started its push into brick-and-mortar retail with its first bookstore in Seattle. The corporate has closed the bookstores and different retail ideas lately.
Amazon says it is going to preserve working a hybrid Amazon grocery retailer alongside Entire Meals in Chicago, and a “retailer inside a retailer” format at a Entire Meals in Pennsylvania the place clients can store Amazon merchandise alongside groceries.
As well as, Amazon says it’s nonetheless experimenting with ideas in bodily retail, so it’s potential that new kinds of Amazon-branded shops may emerge sooner or later.
The closures impression 11 Seattle-area places, together with the unique Go retailer at Amazon headquarters on seventh Avenue in Seattle, the place the corporate debuted its “Simply Stroll Out” expertise in 2018.
It’s a part of a broader reset at Amazon, which can be making ready for one more wave of company layoffs as quickly as this week. CEO Andy Jassy has attributed the cuts to a must streamline operations and scale back forms after years of fast development.
In an inner memo Tuesday morning, Jason Buechel, the Amazon Worldwide Grocery Shops VP and Entire Meals CEO, advised workers who constructed and ran the Recent and Go shops that they “pioneered one thing new” and famous that the Amazon Recent model will nonetheless dwell on-line.
“Though we’re closing these shops, the impression of your work will form our subsequent era of retailer ideas and buyer experiences,” he wrote within the memo, obtained by GeekWire.
As a part of the adjustments, Amazon is shifting its on-line grocery success, logistics and associated operations to SVP Udit Madan‘s Worldwide Operations group.
What’s working for Amazon in grocery
Amazon launched its Recent grocery supply service in Seattle in 2007, beginning a protracted push into one in all retail’s largest and most troublesome classes. Grocery margins are skinny and competitors is fierce, however the prize is very large: People spend greater than $1 trillion a yr on groceries, and profitable these purchases means profitable a buyer’s weekly routine.
The corporate reiterated right now that it’s now one of many high three grocers within the U.S., with greater than $150 billion in product sales and 150 million clients searching for groceries annually.
Amazon says Entire Meals gross sales have elevated by greater than 40% because it acquired the chain in 2017, now working in additional than 550 places. The corporate says it is going to open greater than 100 extra shops over the following a number of years, and broaden its smaller Entire Meals Every day Store format from 5 to 10 places by the tip of 2026.
The corporate not too long ago received approval to construct a 230,000-square-foot “supercenter” in Orland Park, Illinois, a Chicago suburb, combining groceries with basic merchandise. That retailer, Amazon’s largest bodily retail enterprise but, is predicted to open in 2027.
Within the meantime, Amazon is increasing its Identical-Day Supply service for contemporary groceries, now accessible in 2,300 U.S. cities and cities. The corporate says perishable grocery gross sales by way of the service have grown 40-fold since January 2025, and that contemporary gadgets now make up 9 of the highest 10 most-ordered merchandise the place the service is offered.
The “Simply Stroll Out” expertise initially developed for Amazon Go comfort shops, which makes use of overhead cameras and sensors to keep away from conventional checkout, will dwell on as a licensing enterprise.
Amazon says the expertise now operates in additional than 360 third-party places throughout 5 international locations, together with hospitals and sports activities arenas, and in additional than 40 of its personal success heart breakrooms.
Indicators of the shift
Buyers who observe Amazon’s enterprise intently is probably not shocked by the information. On the corporate’s October earnings name, Evercore ISI analyst Mark Mahaney requested Jassy straight whether or not Amazon nonetheless wanted Recent shops given the traction in on-line grocery supply.
Jassy’s reply was telling, particularly in hindsight. “We proceed to experiment with varied codecs,” he stated, with out answering the query concerning the want for the Recent shops straight.
The CEO made it clear that the format Amazon was most enthusiastic about was same-day supply of perishable groceries. Since August, Amazon has expanded same-day supply of groceries from 1,000 cities to 2,300, integrating gadgets like milk and produce into the identical procuring cart as electronics and family items.
“We’re on to one thing very vital with what we’re doing with perishables from our same-day services,” Jassy stated on the October name.
On the identical time, the consolidation round Entire Meals has been constructing. A yr in the past this week, Amazon expanded Buechel’s function past Entire Meals to supervise its total worldwide grocery enterprise, together with Amazon Go and Amazon Recent — a transfer that, on reflection, might have signaled the place the corporate was headed.
