Amazon is set to close its 58 Amazon Fresh grocery stores and 14 Amazon Go locations, marking a significant shift in its retail strategy. The closures are expected to occur by this Sunday, potentially impacting thousands of hourly workers and a small number of corporate personnel. In response, Amazon has stated it will assist affected employees in finding new roles within the company.
Despite the shutdown of its branded physical stores, Amazon claims to remain a key player in the grocery market, asserting it ranks among the top three grocers in the United States with annual sales exceeding $150 billion. The company also revealed plans to expand its Whole Foods brand, aiming to open more than 100 new locations in the coming years, including smaller Daily Shop formats focusing on convenience items.
Amazon's foray into physical retail began in 2015 with the opening of its first bookstore, followed by various concepts that ultimately did not succeed. The company acknowledged in a recent blog post that while some physical grocery stores showed promise, they lacked a sustainable economic model for larger expansion.