Richmond Grocery Wars Update: Amazon Announces Amazon Go

As the region's grocery wars have continued to escalate with announcements of new locations by Aldi and Lidl, closings of the Martin's locations that are being acquired by Publix, and the recent opening of a new Wegmans in Charlottesville (and an announcement by Wegmans that it will not open a store in Newport News), a new twist has just entered the fray.

Many consumers use Amazon for ordering "staples", such as toilet paper, diapers, and other groceries. Amazon, described as an "e-commerce powerhouse", is now increasing the competition in the grocery market. On December 6, 2016, the Richmond Times Dispatch / Associated Press reported that Amazon is testing a new grocery store concept in Seattle, Washington. (The article is available here.) Amazon Go, as the store is called, will distinguish itself in the market by not including checkout lines.

Amazon Go shoppers will scan their Amazon app when they enter the store. Sensors then register items that they pick up and automatically charge them to the app (if the item is returned to the shelf, the charge is removed). Shoppers simply exit the store with their goods and do not go through a checkout process. The article reports that the stores will offer "ready-to-eat meals, staples such as bread and milk and meal-making kits".

Initially, Amazon is testing this concept with its employees. Amazon Go stores are expected to open to the public in early 2017 in various locations. My strong suspicion is that demographics focused on millennials will drive the location determinations.

A story on The Today Show about Amazon's announcement did, however, note that there may well be collateral damage from the concept; i.e., the loss of jobs by grocery checkout personnel.

With much of the focus of the Richmond area's grocery wars being placed on meeting the needs of the next generation of grocery shoppers, the Amazon Go concept may well impact our local grocery market.

Stay tuned!


Spotts Fain publications are provided as an educational service and are not meant to be and should not be construed as legal advice. Readers with particular needs on specific issues should retain the services of competent counsel.

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