Amazon to Close 19 UK Grocery Stores, Shift Focus to Online Delivery

LONDON, Sept 23 (Reuters) — Amazon.com announced plans to close all 19 of its Amazon Fresh grocery stores in the United Kingdom, transitioning its efforts toward online grocery delivery. This decision will involve shutting down 14 stores while converting five into Whole Foods Market locations, as stated by the company on Tuesday.

Amazon emphasized its goal of offering redeployment opportunities to affected employees, although it did not clarify the number of jobs at risk. The company aims to consult with employees before making any final decisions regarding the closures.

Launched less than five years ago, Amazon Fresh was designed to provide a unique shopping experience featuring its “Just Walk Out” technology. This technology enables customers to skip traditional checkout lines by automatically charging their Amazon accounts as they leave the store with their selected items.

The move comes after a thorough evaluation of Amazon’s grocery operations and the strong growth potential of its online grocery delivery services. The company reported significant demand for household essentials and groceries through various channels, including its Amazon.co.uk platform and partnerships with retailers like Morrisons and Co-op.

Amazon plans to introduce same-day delivery of perishable goods in the UK next year, further emphasizing its commitment to online grocery services. According to Amazon UK manager John Boumphrey, the company is dedicated to continuing its innovation and investment in the UK market.

While some experts argue that the closure reflects challenges within the grocery sector, analysts have pointed out that Amazon’s grocery strategy has frequently changed. Sucharita Kodali, a Forrester analyst, noted that the highly competitive grocery landscape in the UK has made it difficult for Amazon Fresh to find success.

The developments at Amazon Fresh have sparked reactions from labor representatives, with the GMB union criticizing the company’s treatment of employees. They expressed concern about the ethics behind Amazon’s staffing practices, stating that workers deserve better treatment.

As Amazon adjusts its grocery strategy in the UK, it remains to be seen what changes will unfold as it continues to focus on enhancing its online delivery capabilities.