The new stores will likely be smaller than Whole Foods and have a more standard product range.
Here’s something none of us expected to read today: The Wall Street Journal reports that Amazon is planning to launch a new line of grocery stores. Yes, I’m writing this in 2019. Yes, Amazon still owns Whole Foods. Yes, Amazon is still rolling out its small, cashier-free Amazon Go convenience stores. These stores would be another group of supermarkets — because apparently now that Amazon has gotten a taste of brick and mortar, they just can’t get enough of the stuff!
The as-of-now unnamed stores would be larger than Amazon Go stores, but only about half the size of a typical supermarket — with the WSJ’s anonymous source clarifying that though Amazon has already secured some leases, these stores are still not guaranteed to open. Meanwhile, the new supermarkets would theoretically offer a broader range of products than Whole Foods — which, despite Amazon’s buyout, still holds on to many of its upmarket grocer ideals like no preservatives or artificial sweeteners.
These stores are planned for “dozens” of major American cities, according to the WSJ, with the first one slated to open in Los Angeles as soon as by the end of this year. They’ll reportedly be separate from Whole Foods though whether they’ll have Amazon branding wasn’t clear. The source also suggested that Amazon could once again take an acquisition approach, but only by snatching up smaller regional grocery stores that could quickly be brought under the Amazon umbrella.
Of course, we can debate the merits of these new stores when (and if) they open, but for now, you have to wonder what this means for Whole Foods. Clearly, it could be a good sign, especially in the short term, because it shows that Amazon is apparently unwilling to degrade the upmarket chain’s standards to fit all of its needs. But what about the long term? Would Amazon really want to be operating multiple grocery chains with different branding? And if they create their own new chain from scratch, wouldn’t that seem to trump an existing brand created by a couple of hippies they didn’t even know? Clearly, it’s all speculation at this point, but Amazon is certainly once again giving us plenty to speculate about.