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Amazon continues to close its Amazon Go stores, questioning digital+physical concept

by GLO
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As of now, Amazon operates 16 Amazon Go stores. Despite the significant reduction, the spokesperson emphasised that the company remains committed to its Go convenience stores, considering physical retail an integral part of its long-term strategy.

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Amazon Continues to Scale Down Its Amazon Go Stores

Amazon is further reducing its Amazon Go store footprint, raising questions about the viability of its hybrid digital and physical retail concept. The company will permanently close its convenience store in Woodland Hills, California, on February 26, marking another step in its broader strategy to reassess its brick-and-mortar presence. Since early 2023, Amazon’s total store count has declined by approximately 50%.

A company spokesperson confirmed the closure to C-Store Dive but did not disclose specific reasons, stating only that it was part of a portfolio assessment. The Woodland Hills location is among Amazon Go’s suburban-format stores, which cater to shoppers outside of dense urban centers where the brand’s conventional stores are typically situated.

Over the last three years, Amazon has shuttered nearly half of its Amazon Go locations as it faces challenges maintaining its physical retail expansion.

Industry Trends and Strategic Moves

At its peak in early 2023, Amazon operated around 30 Amazon Go stores across Washington, California, New York, and Illinois. However, cost-cutting measures led to widespread closures, including eight stores in April 2023, with four in San Francisco, two in Seattle, and two in New York City shutting down simultaneously.

As of now, Amazon operates 16 Amazon Go stores. Despite the significant reduction, the spokesperson emphasized that the company remains committed to its Go convenience stores, considering physical retail an integral part of its long-term strategy.

The Woodland Hills store, which had been in operation for three years, will officially close next month. Unlike standard Amazon Go locations, this store offered an expanded selection of grab-and-go meals, freshly made-to-order dishes such as breakfast items, sandwiches, salads, wraps, and specialty beverages like kombucha and on-tap coffee. Additionally, the store housed a Pinkberry frozen yogurt station.

Following the closure, all 10 employees at the location will be laid off effective March 10, according to a California WARN notice filed last week. Amazon has stated that efforts are underway to find alternative roles within the company for these employees, particularly at nearby Amazon operational sites.

While Amazon Go has struggled, its other physical retail ventures continue to evolve. Amazon Fresh has recently surpassed 50 locations, overcoming initial challenges, and Whole Foods, which Amazon acquired in 2017, has shown consistent growth.

Simultaneously, Amazon’s Just Walk Out technology, the core feature of its cashier-less stores, has been expanding beyond its own retail operations. The company continues to license the technology to third-party retailers and has successfully deployed it in over 200 stores across the U.S., U.K., Australia, and Canada. This technology remains a significant aspect of Amazon’s retail innovation strategy, even as its own brick-and-mortar footprint contracts.

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