Amazon Fresh Resumes Expansion with New Store Openings

Amazon Fresh, the grocery chain, is back in expansion mode after a yearlong stall. The company has opened new stores in various states, including California, Illinois, and Pennsylvania. These openings follow a pause in growth as Amazon sought a store format that resonated with shoppers and was economically viable.

Amazon's grocery ambitions date back to 2006, culminating in the 2017 acquisition of Whole Foods for $13.7 billion. Despite this, Amazon holds just 1.4% of the U.S. grocery market, compared to Walmart's 23.6% and Kroger's 10%.

Fresh stores, launched in 2020, initially offered cheaper prices than Whole Foods, along with innovative features like cashierless checkout and voice-activated displays. By early 2022, Amazon had 46 Fresh locations worldwide. However, CEO Andy Jassy's cost-cutting measures led to layoffs and the closure of some stores.

In 2023, Amazon resumed investing in Fresh, refining the store experience and testing redesigned formats. The new stores feature a more colorful layout and include Krispy Kreme stalls. Amazon also replaced cashierless technology with computerized Dash Carts, which track items as customers shop.

Despite these efforts, at least 22 Fresh stores remain unopened, and delayed openings have led to lawsuits from landlords. Amazon's scattershot approach to grocery expansion reflects the challenges of breaking into a market dominated by established players.