At a Glance
- Amazon is closing its 58 Amazon Fresh grocery stores and 14 Amazon Go convenience locations.
- The shutdowns are slated for this Sunday, affecting thousands of hourly workers and about a dozen corporate staff.
- Despite the closures, Amazon says its grocery business still ranks among the top three U.S. grocers, with $150 billion in gross sales and 150 million shoppers annually.
Why it matters: The move signals a strategic pivot toward its Whole Foods brand and a continued focus on grocery delivery.
Amazon announced the closure of its Amazon-branded physical stores in a blog post on Wednesday. The company said it had “encouraging signals” in its stores but had not yet created a distinct customer experience with a viable economic model for large-scale expansion.
From Bookstore to Grocery
Amazon first entered physical retail in 2015 with a bookstore. Over the years it tried several concepts:
- Amazon 4-Star shop selling kitchen goods, toys, and electronics.
- A short-lived clothing store.
- Other rotating lineups of in-store experiments.
None of these concepts survived.
Store Count Overview
| Store Type | Number of Locations |
|---|---|
| Amazon Fresh | 58 |
| Amazon Go | 14 |
Both chains are set to close.
Impact on Workers
Amazon said it is working to help impacted workers transition into other roles within the company, including positions in its operations network. The shutdowns are expected to affect:
- Thousands of hourly workers.
- Roughly a dozen corporate employees.
Bloomberg reported that most of the stores will close by this Sunday.
Grocery Ambitions Continue
Despite the closures, Amazon reiterated its grocery ambitions. In the same blog post, it highlighted:
- The grocery business is now one of the top three U.S. grocers.
- It has generated $150 billion in gross sales.
- It serves 150 million grocery shoppers every year.
Whole Foods Expansion
Amazon is doubling down on its Whole Foods brand, acquired in 2017. The company plans to:
- Open more than 100 new Whole Foods Market locations over the next few years.
- Expand the smaller Whole Foods Market Daily Shop format.
- Convert some closed Amazon Fresh and Amazon Go stores into Whole Foods locations.
The Daily Shop format focuses on grab-and-go meals, coffee, and everyday essentials. Currently, there are 5 Daily Shop locations.
Delivery Expansion
Amazon also plans to expand its same-day delivery service for perishable groceries to more cities and towns later this year.
Summary
Amazon’s decision to shut down its Amazon Fresh and Amazon Go stores marks the end of several physical retail experiments. The company is redirecting resources toward its Whole Foods brand and its robust grocery delivery network, while maintaining a strong position in the U.S. grocery market.
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Sources: Bloomberg, Amazon blog post, and corporate statements.
