Amazon continues to eye the brick-and-mortar landscape with its recent Kroger merger. The company is looking to take over Kroger’s current physical footprint, in hopes to achieve their overall physical retail goals in the grocery sector. This move was made in hopes to build Amazon’s distribution efforts and create new opportunity in retail. “In theory, Amazon could plug acquired stores into its network, which would (potentially at least) prove less painful and costly than building a distribution and logistics network from scratch,” the analysts reportedly wrote, per a recent report.
Amazon currently operates 44 Amazon Fresh stores and 28 Amazon Go stores. These numbers have continued to grow recently, and will only increase with this new opportunity. By taking over Kroger stores, this will allow them to take their grocery business to the next level. There have been signs that point to the fact that a mass grocery format may perform more successfully than their current smaller, specialty stores.
“While we’re pleased with the size and growth of our grocery business, we aspire to serve more of our customers’ grocery needs than we do today. To do so, we need a broader physical store footprint, given that most of the grocery shopping still happens in physical venues,” said Andy Jassy, Amazon CEO and President.
The key to growth in any retail sector is a physical element. Amazon has continuously eyed the brick-and-mortar space over the last few years. It seems that the e-commerce giant is looking towards more predictable avenues of revenue, and straying away from unpredictable e-commerce strategies. Amazon’s physical elements continue to prove that an omnichannel will always be more favorable to consumers versus a sole direct-to-consumer channel.
Source: Amazon & Kroger – PYMNTS
Photo Credit: Amazon – Supermarket News
