Amazon plans to open grocery stores in Seattle, Bellevue

by Tony Lystra | January 11, 2021 | Seattle Business Journal

Amazon is opening two new Amazon Fresh grocery stores –– one in Seattle and another in Bellevue, the company announced Monday morning.

The Bellevue store will be located in Factoria and the Seattle store will be located in the city’s Central District. Both sites are under construction, an Amazon spokeswoman said.

The company hasn’t disclosed the addresses for each location, nor did it say when the stores would open. Amazon said in a statement that hiring has begun for both stores, which are expected to bring “hundreds of full- and part-time jobs, including managerial roles” to the Puget Sound region.

Groceries have become an increasingly important business for Amazon, especially during the past 10 months of the Covid-19 pandemic, when customers began relying on Amazon’s grocery delivery service rather than venturing out in public.

Groceries are a trillion-dollar business. Delivery services made up 3% of the market share before the pandemic and increased to 9% in a matter of months.

Amazon currently operates two Amazon Go grocery stores –– its highly automated business model that uses sensors and a phone app to allow customers to shop without checking out at a cash register –– in Seattle and Bellevue.

The company bought Whole Foods Market for $13.7 billion in 2017, giving it about 500 high-end grocery stores nationwide. Amazon said it currently operates 11 Whole Foods Market locations in Washington state, as well as five Amazon Go stores.

Nationwide, Amazon operates 26 Amazon Go stores. Amazon opened its first Amazon Fresh grocery store in Woodland Hills, California, last summer and more stores are said to be coming to other parts of Los Angeles, Chicago and Philadelphia.

Other potential sites include New York, New Jersey and Connecticut, according to news reports.

The Amazon Fresh stores announced Monday are part of the company’s effort to expand its capacity to fulfill grocery orders as demand has skyrocketed. In addition to functioning as conventional grocery stores, the company will use the Amazon Fresh stores to fulfill online orders for delivery and pickup.

The announcement also comes less than a week after Amazon said it would shutter its Prime Pantry delivery service, which was launched in 2014.

Amazon tracks every purchase online or in its brick-and-mortar stores and pools that data to fuel its advertising business, which is worth more than $14 billion.

Early in the pandemic, Amazon’s Fresh grocery service was so swamped with orders that it was difficult to find a delivery slot in the Seattle area and Amazon, for a time, began putting new customers on a waiting list.

Amazon has since built out its capacity to fulfill orders across its entire supply chain, including groceries, increasing its workforce by 400,000 and its warehouse space by 50% last year alone.

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