Amazon Is Set to Open Its First Full-Size, Cashier-Less Grocery Store

Written by Jennifer Clark
Posted February 26, 2020

It’s been a few years since Amazon (NASDAQ: AMZN) announced that it had plans to open up a grocery store that would be cashier-less. These stores would use technology that allows customers to walk in, select items that would show up in their “cart,” and be charged when they leave the store. 

Amazon acquired Whole Foods back in 2017 to help fuel this new grocery concept. The grocery store industry in the U.S. is worth about $800 billion. Naturally, it was an industry that Amazon wanted to dominate. On Tuesday, the company announced that it would be opening its first, full-size, cashier-less grocery store. Five years in the making, the first full-size Amazon Go Grocery will be located in the Capitol Hill neighborhood of Seattle, Washington.

Shoppers walk in, scan a QR code from their Amazon mobile app, and then add any item they want to their basket as they walk throughout the store. The idea is to reduce the time customers wait in lines, which can back up the stores and discourage shoppers. 

However, just because the store will be cashier-less doesn’t mean there won’t be anyone working. The store will employ about a dozen associates to help stock shelves and answer shoppers’ questions. But, for the most part, there will be barely any human interaction between employees and customers. 

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Cameron Janes, vice president of Amazon’s physical retail division, said:

We’re just getting started here. I think what we’re trying to do here — and with all of our physical stores — is really work backwards from the customer, and deliver some differentiation.

At about 40,000 square feet, these stores will be smaller than a typical U.S. grocery store. The Amazon Go Grocery will stock about 5,000 items, including fresh produce, dairy, packaged seafood, meats, bakery treats, household goods, meal kits, and a liquor selection with wine and beer. Since shoppers will be picking and bagging their own produce, each item will be priced individually. With no weighing required, everything will be more seamless.

Janes and his team were faced with a challenge when creating the store. He said, “[the] biggest incremental challenge [is] to enable customers just to shop and not have to worry about the technology.” This will be some customers' first encounter with a cashier-less store, so it may be hard for them to not test out the technology. One thing to consider is people picking up items and not putting them back in the right spot and how that will affect the tech. 

There will be a little bit of a learning curve for everyone. Since Amazon first announced it would open up cashier-less grocery stores, rivals have emerged aiming to do the same thing. 

Two technology startups, AiFi and Grabango, have been working with big retailers who compete with Amazon to create autonomous systems. 7-Eleven has opened its own cashier-less store near its corporate headquarters in Irving, Texas. The company has opened this store exclusively to employees as a way to better understand the technology involved and the types of issues that may arise before potentially launching similar stores throughout America.

The grocery industry will always be around. It hasn’t had much innovation in the past few decades, which is why this concept is so intriguing. People love self-checkout lanes because they don’t have to interact with a cashier and can be in control. The only downfall of self-checkout machines is the long lines that usually come with being in control. So never having to interact with a cashier and not waiting in a line sounds like a shopper's dream come true.

Until next time,

Jennifer Clark
Pro Trader Today
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