Report: Amazon keeps pace with Walmart in grocery fulfillment

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Report: Amazon keeps pace with Walmart in grocery fulfillment

By Dan Berthiaume - 02/21/2020
CAD analysis of Amazon’s microfulfillment center and cold storage warehousing inside its new Woodland Hills concept (Source: HNGRY)

Amazon’s new grocery store format will reportedly include advanced technology to streamline in-store fulfillment of online orders.

According to the Hngry food retailing blog, plans Amazon has filed with the City of Los Angeles indicate a brick-and-mortar store it intends to open in Woodland Hills, Calif. will include a dedicated “microfulfillment” section. Microfulfillment centers are small, warehouse-style spaces located within stores that use robotic technology to automatically pick and retrieve products. Automation allows a much greater density of products than can normally be stored in a contained space.

Typically, microfulfillment is used to enable localized in-store fulfillment of online orders. It has primarily been piloted in the grocery vertical, with notable retailers including Walmart, Albertsons, and Loblaw testing microfulfillment technology in their stores. Kroger is building a network of warehouses equipped with microfulfillment technology to ease the burden online fulfillment places on its stores.

Hngry reports that Amazon will use technology from Dematic, whose microfulfillment solution is also currently being implemented by Midwestern discounter Meijer, in the 7,200-sq.-ft. space it has dedicated in the plans for the Woodland Hills store. The space will store products including alcoholic beverages and packaged food, and represents about 20% of the store’s roughly 33,500-sq.-ft. footprint. 

The Woodland Hills store is the first location of what is expected to be a new chain of Amazon grocery stores. In October, The Wall Street Journal reported that Amazon had signed more than a dozen leases in the Los Angeles area as part of its plan to launch a new grocery chain. Amazon has said publicly that its new grocery store format will feature conventional checkout technology, rather than the proprietary cashierless self-checkout featured in Amazon Go stores.

Read the full Hngry article here.