Amazon is falling behind on plans to open hundreds of Fresh stores

Amazon is falling behind on its plans to open hundreds of its cashierless Fresh stores by 2023, according to Business Insider.

In documents shared with Business Insider, Amazon projected itself to open 33 cashierless stores in the US this year, rising to 280 in 2022 and 580 in 2023.

The plans even included an adjustment to reflect a a more “pessimistic scenario” because of a second wave of COVID-19 late last year.

The only cashierless Fresh store that is open in the US so far is located in Washington’s Factoria neighbourhood of Bellevue.

Grocery continues to be a “pitfall” for Amazon due to most grocery shopping being done offline, according to a recent report by Business Insider.

READ MORE: Amazon and Starbucks ponder launching coffee shop with cashierless tech

Online grocery purchases only account for 9.6 per cent of total grocery sales in the US, with Amazon’s offering not nearly as competitive offline.

Despite expanding its bricks-and-mortar locations, recently opening its first Amazon “4-star” in the UK, Amazon is seeing slow sales growth in those divisions.

Amazon’s physical stores segment, which includes revenue from all of its bricks-and-mortar locations, suffered four straight quarters of declining growth, until the second quarter when sales bounced back up 11 per cent to $4.2 billion.

The ecommerce giant expects to reduce to cost of fitting out its Fresh stores in order to speed up the roll out, with the annual tech operating cost for each of the stores expected to drop by 75 per cent between 2020 and 2023.

“Amazon always overestimates,” someone familiar with the matter told Business Insider.

“We really want to get as many out there as possible so we can learn from them and get feedback.”

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