Amazon is pressing pause on dozens more self-checkout grocery stores amid disappointing sales, report says
- Amazon is halting the rollout of more Fresh self-checkout food stores, The Sunday Times reported.
- Sources told the UK newspaper that disappointing sales and an uncertain economy led to the decision.
- Amazon has struggled to open physical stores amid high costs and tension with Whole Food.
Amazon is pausing the rollout of self-checkout Amazon Fresh stores following disappointing sales and economic headwinds, The Sunday Times reported.
Sources told the UK newspaper that Amazon had walked away from talks on dozens of new sites for its grocery stores and ended searches for new locations.
Most existing Fresh stores had fallen short of sales projections, according to the report, while the costs of building the outlets dwarfed those typically associated with other convenience stores.
The Sunday Times reported that some store openings would go ahead if leases had already been signed.
A spokeswoman told the newspaper: “We look forward to opening additional Amazon Fresh stores in the near future.”
The news marks the latest in a stunted rollout of Amazon’s physical presence, after years of success as an online retailer.
In addition to poor sales and rising costs, Insider reported that a dysfunctional team culture and tension with Whole Foods, the retailer it bought for $13.7 billion in 2017, were also contributing to delays.
Earlier this week, Insider reported a leaked email indicating a reorganization of the management structure at its physical stores. It was the first major shake-up since Amazon poached Tesco executive Tony Hoggett to head up its physical stores.
Amazon’s share price suffered this year as inflation hurt consumer spending and investor confidence.
Better-than-expected results in July helped the stock regain some ground but it remains almost 19% lower than at the start of January, closing on Friday at $138 and valuing Amazon at just over $1.4 trillion.
Amazon didn’t immediately respond to Insider’s request for further details about the rollout pause.