Amazon to open 3,000 more checkoutless stores
Amazon’s checkout free supermarket, Amazon Go, opened its doors to the public at the beginning of the year, allowing its Seattle-based customers a first look at the future of grocery shopping. Conceptually, the store’s design sounds absolutely crazy; customers simply scan their smartphones as they enter the store, grab what they want from the shelves, and walk out. No lines, no checkout, no human contact.
However, Amazon Go is not a food-based free-for-all. The stores use a system of specialised cameras and weight sensors to track what their customers are taking, and bills their accounts directly through the Amazon Go app. Their tech can even tell if a person has picked something up and put it back down, so you won’t get charged for being indecisive.
Amazon Go established their first location in Seattle in 2016, though the experience remained exclusively employee-only for over a year as they tested out the technology. In 2018, the store officially opened its doors to the public. Personally, I would have loved to check it out, since I was still in America at the time, but there was only one store open, and my morning commute didn’t allow for an 8,710-kilometre detour.
If you’ve ever found yourself in a similar situation, the wait will soon be over. After the initial success of the Seattle store, Amazon has announced an incredibly ambitious plan to open up to 3,000 new stores by 2021. Given that convenience is the chain’s main marketing tool, it’s likely that these new locations would be concentrated in urban areas. So far, only three new stores have officially been announced. Two more are in Seattle and one is in Chicago, though east coast residents should expect a store or two to pop up within the next few years.
Two of these new stores are more meal-on-the-go services than full-blown supermarkets, with only a limited selection of snacks, salads and sandwiches. Moving in this direction has its advantages; it would see Amazon cut down on the amount of cameras and sensors needed, increase the store’s profit margin and overall reduce the initial opening cost. For its part, the original Seattle store spent more than $1 million on hardware alone when it opened in 2016.
So what impact would these new stores have on their competitors? Because of Amazon Go’s focus on high-density urban areas, suburban store owners need not worry. Currently, Amazon Go serves more of a threat to other convenience food chains like Subway, Pret a Manger, and Panera, as well as mom-and-pop brick and mortars.
The convenience of Amazon Go is certainly attractive to city-dwellers, especially those who have a little bit more money to spend, since Amazon Go is not appearing to be a cheap shopping alternative. But right now, the novelty of Amazon’s newest project seems to outweigh any concern over cost. Because you have to admit, it is cool. Whether or not it remains profitable after the novelty wears off is a different story entirely.