Amazon is scaling back its Amazon Go checkout-free convenience store format.
The omnichannel giant is closing eight Amazon Go convenience store locations as it continues to pursue cost-cutting measures in an uncertain economy. The stores targeted for permanent shutdown include two stores in a high-crime area of downtown Seattle (the stores have already been closed for a while) as well as two New York City locations and four San Francisco ones, which are scheduled to close April 1.
The New York City Amazon Go stores that are set to close are on Maiden Lane in the Financial District, and on Park Ave. South in the Flatiron District. The San Francisco locations include 3 Embarcadero Center; 300 California Street; 575 Market Street, Ste. 150; and 98 Post Street.
“Like any physical retailer, we periodically assess our portfolio of stores and make optimization decisions along the way,” an Amazon spokesperson said in a statement emailed to Chain Store Age. “In this case, we’ve decided to close a small number of Amazon Go stores in Seattle, New York City, and San Francisco."
"We remain committed to the Amazon Go format, operate more than 20 Amazon Go stores across the U.S., and will continue to learn which locations and features resonate most with customers as we keep evolving our Amazon Go stores," the Amazon spokesperson added.
Amazon Go – a brief history
The Amazon Go format debuted at a store in Seattle in January 2018. The concept features Amazon’s “Just Walk Out” technology, and is designed to offer customers a quick shopping experience to pick up grab-and-go food, snacks and beverage items and a few everyday essentials.
Amazon has since launched other versions of Amazon Go, including a “Starbucks Pickup with Amazon Go” format launched in November 2021, which primarily accepts orders that are placed through the Starbucks app prior to the customer arriving at the store fulfills them via the “Just Walk Out” cashierless technology platform. Amazon also rolled out a suburban Amazon Go format in Mill Creek, Wash., in April 2022.
The newest Amazon Go location, opened in February 2023 in the Frederickson area of Puyallup, Wash., about 35 miles south of Seattle and 10 miles east of Tacoma. The decision to close eight Amazon Go stores comes about a month after Amazon put the expansion of its grocery store concept, Amazon Fresh, on pause.
Read more about Amazon’s reported decision to close down select Amazon Go stores here.
Amazon cuts costs
Amazon has been reducing its spending in a variety of areas. Recent media reports indicate Amazon is delaying groundbreaking on the second phase of its second headquarters in Northern Virginia, known as “HQ2.” The e-tailer still currently plans to open the first phase of its new corporate campus as scheduled in June 2023.
In November 2022, Amazon publicly announced it has decided to “consolidate” some teams and programs in the devices and services organization (responsible for product lines such as Amazon Echo and Kindle devices).
At the beginning of 2023, Amazon said it plans to eliminate just over 18,000 roles in 2023, with the majority of eliminations in its Amazon Stores and PXT organizations. Around that time, the Amazon Shopping organization laid off its entire user experience research staff of about 14 people.
These job cuts follow a recently announced hiatus in corporate hiring. The company has previously said it still intends to hire a “meaningful number of people” in 2023. Other cost reduction efforts have included shuttering the Amazon Smile program, which donated 0.5% of a participating customer’s purchase to a charity of their choice.