Amazon ramps up delivery wars in deal with Rite Aid

Amazon is launching its own version of buy-online-pickup-in stores.

The online giant is partnering with Rite Aid to launch “Counter,” dedicated counters in Rite Aid stores where Amazon customers can pick up their purchases. The service, which is free to all Amazon customers, is now available in more than 100 Rite Aid stores, and will be rolled out across 1,500 locations by the end of the year. Financial terms of the arrangement weren't disclosed.

The deal should be a win-win for both parties. Rite Aid stands to benefit from increased foot traffic in its stores. And at a time when physical retailers are emphasizing their BOPIS capabilities, Amazon is gaining access to an already existing nationwide store network for deliveries. The company noted it is actively looking for additional Counter partners, including small to midsize businesses and other large chains.

Amazon designed and built the technology for Counter from the ground up. The company originally launched the service in the U.K. with apparel retailer Next and in Italy with Giunti Al Punto Librerie, Fermopoint and SisalPay stores. The service has been positively received, driving strong customer engagement and additional foot traffic for partners, Amazon said.

Here’s how Counter works: When checking out on Amazon, customers can select one of the Counter pickup points available in their zip code as their delivery location. Once the order arrives at the designated store, customers receive an e-mail with a unique barcode. At the store, customers provide the barcode to store staff, who scan it and retrieve the package. Customers have 14 days to collect their package.

“With Counter, we’ve leveraged our growing logistics network and invested in new, easy to use technology to give customers yet another delivery option rooted in flexibility and control,” said Patrick Supanc, worldwide director of Amazon Hub. “We are excited to partner with national businesses like Rite Aid, and local businesses in the future, to create an outstanding experience for our shared customers.”

Amazon has been ramping up its partnerships with retailers, including Kohl’s. Starting in July, all of Kohl’s 1,150-plus stores will accept free, unpackaged returns of Amazon purchases. Kohl’s launched the program at 82 stores in Chicago and Los Angeles in fall 2017. (The deal with Rite Aid does not include returns.)

Jocelyn Konrad, executive VP, pharmacy and retail operations of Rite Aid, said being the first store partner for Counter in the U.S. is a differentiator for Rite Aid, “and we believe our partnership with Amazon, that includes Locker, creates a stronger in-store experience for existing customers and new customers that come in to pick up their packages.”