Amazon May Open 3,000 Stores in Next Three Years

Irving Hamilton
September 20, 2018

Amazon also routinely loses money expanding internationally. Since then, the company has opened two more Seattle sites and one in Chicago, and has confirmed plans for San Francisco and NY stores.

7-Eleven operates about 8,000 locations, according to the National Retail Foundation's 2017 tally.

As a matter of perspective, 7-eleven, the largest convenience store chain in the world operates 8,600 stores in the USA, and in 2017 generated $14.33 billion in U.S. sales alone.

Shares of big grocers slipped in response to the report Wednesday. Walmart Inc. declined as much as 0.6 per cent, reversing an earlier gain, while Target Corp. dropped about 1.5 per cent and Kroger Co. slid as much as 3.1 per cent. Amazon's other brick-and-mortar initiatives include about 20 bookstores around the US and the natural grocery chain Whole Foods Market, acquired past year.

That many new stores could change people's expectations for convenience stores, forcing other retailers to adopt a cashier-less model. That never happened and Amazon issued a rare denial of the rumor. However, with less staff and strictly dedicated to foodstuffs, which have a higher profitability than other retail goods, Amazon hopes to recoup the investment faster than your bog-standard food store.

Amazon Go is Amazon's cashierless store, which features what it calls "just walk out" technology and payment through its proprietary app.

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"We have no plans to open 2,000 of anything", a spokesperson said a few days after the newspaper's story published. The first is on Amazon's campus in Seattle.

The idea is to open up stores in dense urban areas with large populations of young, well-to-do folks who are happy to pay a premium for high-quality meals on the go.

Currently, Amazon Go has three locations in Seattle, Washington and one in Chicago, the latter of which just opened this week.The first Seattle location opened in 2016, and it is one of two that have a small selection of groceries in addition to the limited options of salads, sandwiches and snacks all of the stores have. Once inside, cameras and sensors track what they pick up from the shelves and what they put back. "If you weren't in a high-traffic area, you were going to be at a great disadvantage".

Amazon could reduce the cost of hardware and increase profit margins by focusing on selling prepared foods, instead of offering an expanded selection of grocery items.

Amazon's ramp up could accelerate quickly.

The tech giant already has four locations of its Go stores up and running, but it may have up to 10 locations open by the end of the year, with as many as 50 by 2019, Bloomberg reported, citing sources close to the situation.

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