Amazon said Tuesday it plans to sunset its Fresh and Go brick-and-mortar chains, marking a major pivot in the company’s grocery strategy.”After a careful evaluation of the business and how we can best serve customers, we’ve made the difficult decision to close our Amazon Go and Amazon Fresh physical stores, converting various locations into Whole Foods Market stores,” the company wrote in a blog post.Amazon said the closures are part of an effort to prioritize investments, though it hasn’t given up on physical retail.The company still plans to roll out other brick-and-mortar concepts, including “a mass physical store format.” It will continue to operate its Fresh grocery service and invest in same-day delivery of groceries, the company said.The company said it expects to open more than 100 new Whole Foods locations over the next few years.It will also expand its line of Whole Foods Daily Shops , which are mini-markets that offer a smaller assortment of grocery items.Last month, Amazon received approval from local officials in a Chicago suburb to construct a big-box store that would offer groceries, household essentials and general merchandise.
Amazon declined to share how many Fresh and Go workers will be impacted by the store closures.
It said it’s working to help employees find roles in its operations network, and that they will be eligible for a severance package.For almost two decades , Amazon has been determined to become a bigger player in the grocery market.In 2017, the company spent $13.7 billion to acquire Whole Foods , the largest deal in its history.Amazon debuted its Fresh grocery chain in 2020, with an eye toward mass-market shoppers.
The rollout was turbulent in its early days, with Amazon opening a flurry of locations, before it shuttered some stores and halted expansion of the chain as part of broader cost-cutting efforts.The company launched a revamped Fresh store concept in 2023 , and then continued to tweak its strategy.Amazon shuttered all of its U.K.Fresh stores last September, and closed a handful of locations in Southern California soon after.
Amazon’s Go convenience marts, which debuted in 2018 , were a pet project of founder Jeff Bezos .The stores were designed to alleviate the headache of standing in a checkout line by allowing shoppers to “Just Walk Out.” Locations were outfitted with an array of cameras and sensors that tracked each item shoppers picked off the shelf and automatically charged them as they exited the store.”No one likes to wait in line,” then-CEO Bezos wrote in his 2018 letter to shareholders.”Instead, we imagined a store where you could walk in, pick up what you wanted, and leave.” The company shifted further away from the cashier-less technology in 2024 when it removed the systems from its grocery stores.
In recent years, Amazon has sought to sell the software to other companies, primarily sports stadiums, concert venues, hospitals and colleges.It’s also tested the automated grab-and-go technology in its warehouses.Amazon has brought the Whole Foods division closer to its in-house grocery teams since the 2017 acquisition.Last January, Amazon tapped Whole Foods CEO Jason Buechel to oversee its worldwide grocery business.
The company also began testing a “store within a store” concept at some Whole Foods locations where customers can order a wider array of Amazon products that aren’t typically offered at the upscale grocer from an automated warehouse affixed to the store..
