Amazon shifts grocery partnerships from on-site storefronts
Amazon is changing how it collaborates with third-party grocery retailers for purchase and delivery of goods.
In 2023, Amazon began enabling customers without a Prime membership to order delivery from a variety of local grocery and specialty retailers available on Amazon.com. This has included a same-day delivery partnership with regional grocer Weis Markets in cities across New Jersey, Virginia, Pennsylvania and Maryland; as well as same-day, two-hour grocery delivery from Lucky Supermarkets stores in select cities across the San Francisco Bay Area and delivery of the full Winn-Dixie grocery assortment on its site in the greater Jacksonville and Orlando, Fla. areas.
In all these collaborations, partner grocers operate a dedicated storefront on the Amazon site, each with its own delivery fees and specifications such as delivery windows and how fast orders can be delivered.
However, Amazon has confirmed to Chain Store Age that it is going to transition from operating partner storefronts to engaging other forms of collaboration with third-party grocers. Amazon said the decision was partially driven by customer feedback.
“We're always evaluating how we can best serve our grocery customers," the spokesperson said in an email to Chain Store Age. "In response to customer feedback, we're simplifying the shopping experience and evolving how we work with our grocery partners across several countries, transitioning in the coming months from individual grocery partner storefronts to collaborating in other ways.”
The current grocery partnership model, which will shut down across several countries in the coming months, has caused friction resulting from inconsistent delivery offerings across different storefronts. Customers using third-party grocery storefronts will be given advance notice before any closures take place.
Amazon has been in a gradual process of streamlining its grocery offering for the past couple of years. In 2024, the company halted development of Amazon Today, a service which showcased inventory from partner retailers on the Amazon site and then processed orders for fulfillment from local stores or mall locations. An Amazon spokesperson cited increasing overlap between the retailer’s same-day and one-day delivery offerings and Amazon Today.
In January, Amazon announced it had made the “difficult decision” to close its Amazon Go and Amazon Fresh physical stores, converting various locations into Whole Foods Market stores. The decision came after “a careful evaluation of the business and how we can best serve customers.” (Amazon will continue to operate its Fresh online grocery service.)
[READ MORE: Amazon closing its Fresh and Go stores; to open 100 Whole Foods over next few years]
In addition, the company emphasized it will continue to test new physical store experiences, such as Amazon Grocery, which it launched alongside Whole Foods Market in Chicago, and its “store within a store” concept at the Whole Foods Market store in Plymouth Meeting, Pa. Amazon also cited its plans to develop a “mass physical store format that brings customers distinctive selection, value and convenience.”
