Amazon to expand grocery offering with physical convenience stores: WSJ

ONLINE retail giant Amazon is planning to open physical convenience stores as it expands its push into the grocery market.

Amazon plans to expand its grocery business. Picture: Lionel Bonaventure/AFP

ONLINE retail giant Amazon is planning to open physical convenience stores as it expands its push into the grocery market, The Wall Street Journal reports.

According to the WSJ, citing sources familiar with the matter, the small bricks-and-mortar stores would sell “produce, milk, meats and other perishable items” for customers to take home.

Customers would also be able order other items with longer shelf lives such as peanut butter and cereal via their phones or touchscreens in-store for same-day delivery.

According to the report, the stores will draw influence from discounters like Aldi and Lidl, with stripped-down stores, private-label brands and very few employees.

The WSJ says Amazon will also begin rolling out drive-in locations where online grocery orders will be brought to the car, with license plate reading technology to speed up waiting times.

The grocery stores will initially be exclusive for subscribers of Amazon Fresh, Amazon’s grocery delivery service which has been operating in the US for nine years and recently launched in the UK.

An Amazon spokeswoman contacted regarding the report told Agence France-Presse: “We don’t comment on rumours or speculations.”

This would not be Amazon’s first foray into bricks-and-mortar stores. Long a behemoth in internet book sales, Amazon opened a physical book shop in Seattle last year and plans to expand in the US.

However, selling dairy and other perishable products comes with logistic challenges, such as refrigerated storage.

By expanding its offerings of fresh produce and other groceries, Amazon would increase pressure on traditional retailers like Wal-Mart, a popular stop for food shopping.

Amazon has previously refused to comment on rumours of an Australian launch but is understood to be readying a major push.

Earlier this year, Coles boss John Durkan said the supermarket was well aware of the impending threat, but argued geography and population density would make it harder for grocery delivery services to be successful in Australia.

“We are a completely different market to the rest of the world,” he said. “Outside of relatively small hubs, it’s very convenient to do your shopping in Australia.”

— with AFP