Amazon plans to open dozens of large format grocery stores in major cities across the country.
That’s correct: Amazon is planning to take on Kroger, Stop and Shop, Publix and even Wal-Mart. The $800 billion grocery business is about to get a new player.
Amazon bought Whole Foods, they’ve opened Amazon Go cashierless stores, but this is different. The new effort, heretofore shrouded in secrecy, is much more mass market. The new large-format stores are designed to be more like conventional grocery stores--but with the innovation that has become the hallmark of Amazon. That innovation revolves around cashierless payment and artificial intelligence driven operations.
Their first store in Woodland Hills, California, is located in a former Babies-R-Us facility. Fittingly, they have also moved into a former Babies-R-Us in Schaumburg, Illinois. There are six stores now, with more planned. This presents more choice for consumers, more convenience and price competitiveness.
There may also be opportunities in the real estate area. While the first stores are located in former junior boxes (a real estate term for mid-size rental spaces), Amazon may elect to house these stores in stand-alone formats that afford greater flexibility and innovation in areas such as ordering, pick up and drive-throughs.
Amazon leases many fulfillment centers and pick-up centers. These present excellent NNN or NN real estate opportunities due to Amazon’s excellent credit standing. Amazon food stores may present similar opportunities as they roll out this concept.
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