SVE NEWS & USA Today Sharing Series – Amazon opens Seattle grocery store, expanding grab-and-go cashless shopping: Is Whole Foods next?

SEATTLE – Amazon’s radical new approach to buying foods and speeding up the checkout process goes the next mile Tuesday, with a full-size grocery store in Seattle.

The Amazon Go Grocery opens with more than four times the space of the original, 7-Eleven-style, on-the-go type stores first opened in 2018. The e-tailer, which also owns Whole Foods, launched the Go stores as a way for local workers to get in and out, with a just basics menu that bypassed essentials like fruit and frozen foods.

“We believe ‘Just walk out’ technology,” makes shopping a better experience, says Cameron Janes,  vice president of Amazon’s physical stores division. He gave USA TODAY a sneak-peek tour of the new concept Monday.

With Amazon Go Grocery, the company has reimagined the concept as a store offering pretty much everything you’d see at a local market with local fish and meats, wines and beers, fresh doughnuts and cookies and other staples.

The difference: a way smaller footprint, with 10,000 square feet in Seattle, compared to an average of 50,000 square feet for a local Kroger, says Britain Ladd, a supply-side consultant and former Amazon executive.

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What you won’t hear from Amazon are specifics. Will there be a second Go Grocery store? When will the concept expand to other cities? Will Whole Foods go app and cashless, too? No answers yet to those questions.

“We’re starting by opening this store, and we’ll see,” said Janes.

The 25 smaller Go stores are currently in areas including Seattle, New York, Chicago and San Francisco.

Shopping at Amazon Go Grocery

To shop at the Go stores, you download the Amazon Go app and use it to enter the store by scanning the barcode in a kiosk. Once inside, every item you pick up and bag is monitored by the overhead cameras, which note if you return it to the shelf. When done, you walk out of the store and receive an email receipt of your purchase.

The big idea: speed up the process, and don’t make people wait behind long checkout lines, says Janes.

Originally, customers who wanted to pay with cash instead of a credit or debit couldn’t, but Amazon has revised that policy. Several cities have since passed laws demanding that stores accept cash for payment.

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The preference is still to use the app to enter, but Janes says Amazon staffers will be on hand in Seattle to walk-in customers preferring to pay with money.

In the first Go concept, all products were barcoded to be read by the cameras. But now, Janes proudly shows off individual cookies, doughnuts and fruits and vegetables that can be read by Amazon cameras, without the barcodes.

How do they do it? He wouldn’t say, only that Amazon engineers worked hard on making it happen and their breakthrough enabled the opening of the new, larger stores.

“It’s a combination of computer vision, algorithms, cameras, sensors and shelves that get it right, and doing it lots of lots of times,” he adds.

The first Grocery store is in the Capitol Hill section in Seattle , an urban neighborhood far from the suburbs, with validated one-hour parking underground. There is a large independent grocer just a few blocks down the street.

Staffers will not be on hand to help customers to their cars with bags, like at shopping center markets, Janes says.

Cashierless and cashless: Just walk out

Many people have wondered how Amazon deals with theft when there are no cashiers and everybody is on the honor system. What’s to prevent someone from putting a candy bar in their pocket, or trying to thwart the cameras and walk out with stuff it doesn’t see? After all, the sign on the wall says “Just walk out.”

Janes says that Amazon is focused on the “99.9%” of our customers who are good actors,” and that theft “hasn’t been a major issue for us.”

The system works because there are rows and rows and rows of cameras monitoring your every move, and software that speaks to the cameras. On our tour of the store, it seemed like there were at least 1,000 cameras looking down at customers, but Janes says it’s more like “hundreds.”

To those who might be uncomfortable shopping at a store with so many cameras and so much tracking, Janes says this hasn’t been a problem. “We’ve got 25 stores opened, and those complaints just aren’t there.”

The cameras are pretty much 100% accurate, Janes says. “We rarely hear from customers about an inaccuracy,” like an overcharge.

Amazon’s goal: bring the “just walk out,” concept not just to Whole Foods, but unleash a wave of Amazon food stores nationally to compete with the likes of Kroger and Walmart, Ladd says.

The motivator: lower labor costs, which represent 50% of Whole Foods expenses, Ladd says.

He believes with cameras and sensors and, eventually, robots to fulfill orders, Amazon will be selling more groceries than Kroger by 2027 and surpass Walmart by 2035.

 

 

Sources from: USA Today

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