Thursday, 22 February, 2018

Amazon launches grocery delivery from Whole Foods in Virginia Beach

Dallas and Austin first with Amazon Prime Now deliveries from Whole Foods stores Amazon Offers Whole Foods Deliveries in Four Cities through Prime Now High-Speed Service
Heather Davidson | 09 February, 2018, 05:17

Interestingly, Austin-based Amazon customers can still make two-hour orders from Sprouts, one of Whole Foods' biggest competitors.

Amazon Prime members can order "organic produce, bakery, dairy, meat and seafood, floral and everyday staples", from Whole Foods and have the items delivered. Walmart is No. 1, succeeded by Kroger, Costco, and Albertsons. Amazon does not mention just what types "select alcohol" are covered. Turning the weekly grocery run into a two-hour wait on the couch would seem like a pretty compelling reason to get people to throw down the $12.99 monthly or $99 annual fee.

While Americans don't necessarily shop at Amazon every week, they buy food every few days. Data released in early 2018 by the Food Marketing Institute found that online grocery consumption could amount to $100 billion in sales - as much as 20% of the entire grocery market - by 2025, with 70% of shoppers using online food shopping in some capacity within the next five to seven years.

"Today's grocery stocks' reactions to the WFM/AMZN 2-hr. delivery news, [especially] for KR [Kroger], is unwarranted in our view and we'd suggest investors be buyers of the dip as the pullback creates an improved set-up for 4Q17 earnings and increases the discount to what [long-term] value we see is attainable", Mandeville wrote in a note to clients. "Together, we have already lowered prices on many items, and this offering makes Prime customers' lives even easier".

Amazon, usually coy about future plans, strongly hinted that it planned to expand the Whole Foods delivery trial beyond its first four locations. For one, grocery stores aren't warehouses, so it often takes reconfiguring to efficiently find and package fresh food for delivery. "Brick-and-mortar grocery brands have attempted to launch their own delivery programs, but Prime's proven ability to execute consistently could be the tipping point to the adoption of online grocery".

Barclays analysts, meanwhile, have closely followed Whole Foods in-store developments.

The pickers will not certainly be Whole Foods workers.

Once a customer has placed an order, pickers-not necessarily Whole Foods employees-will manually collect the items from a nearby Whole Foods store and put them in "appropriate packaging".

Those pickers will not necessarily be Whole Foods staffers.

"This is where we're starting", said Stephenie Landry, vice president of Prime Now.

Picking from the store can be "challenging", and not to Amazon's usual designed-down-to-the-movement standards, "but most grocers are doing that for click and collect anyway, so it's becoming more industry standard", said Kodali. Those are Uber-like engagement motorists who contract on for only Amazon delivery turns utilizing their personal vehicles but Amazon's routing application.

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