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Amazon To Close Eight Go Stores To Reduce Costs

Key Highlights

  • Amazon has announced plans to close eight of its Amazon Go convenience stores, coinciding with a pullback in its physical footprint and as part of its efforts to reduce costs and scale back its physical presence. 
  • The closures will affect two stores in New York City, two in Seattle, and four in San Francisco, with the stores scheduled to shut on April 1. 

Amazon has stated that it will work to help affected employees find other roles within the company. Despite the closures, Amazon remains committed to the Amazon Go format and will continue to operate more than 20 Amazon Go stores across the United States. 

The move comes as Amazon CEO Andy Jassy looks to reduce expenses across the company and follows January’s announcement that as many as 18,000 employees would be laid off. Amazon has also been shedding warehouse and retail space after a period of rapid expansion during the pandemic.

Amazon Go Stores To Close In Seattle, NYC & San Francisco

According to Amazon spokesperson Jessica Martin, the company regularly evaluates its store portfolio and makes optimization decisions. In this instance, a small number of Amazon Go stores in Seattle, New York City, and San Francisco will be closed. However, Amazon remains dedicated to the Amazon Go format and currently operates over 20 stores across the US. The company plans to continue learning which locations and features are most popular with customers as its Amazon Go stores evolve.

Following its fourth-quarter earnings results, Amazon executives have confirmed the closure of some Fresh supermarkets and Go stores. The company is also halting the expansion of its Fresh grocery chain until it can find a format that is economically viable and resonates with customers, according to CEO Andy Jassy

Amazon has been striving to enter the grocery market since launching its Fresh grocery delivery service in 2007, and in 2017 made its biggest-ever acquisition by purchasing upscale grocer Whole Foods Market for $13.7 billion. 

The first Amazon Go store opened in 2018 at the company’s Seattle headquarters, using cameras and sensors to enable customers to buy products without waiting in line. Amazon has mainly focused on opening stores in urban areas but opened its first suburban location in Mill Creek, Washington, in January last year, targeting commuters on their lunch breaks.

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