Amazon Halts All New Amazon Fresh Just Walk Out Stores

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Re: Amazon Halts All New Amazon Fresh Just Walk Out Stores

Post by ClownLoach »

veteran+ wrote: February 18th, 2023, 1:19 pm
ClownLoach wrote: February 18th, 2023, 11:16 am Today the pylon signs surrounding the Murrieta location have been changed from "Amazon Fresh" to "Amazon Fresh Grocery Store". Amazon must think that their lack of business is because people don't understand what is in the building? They must have even less understanding of basic retail than we gave them credit for. I would be willing to bet their conversion rate is less than 10%. Their problem isn't that customers don't know it is a grocery store. The problem is it's a mediocre, overpriced, out of stock filled grocery store.

Also a new shopping center has been under construction in Cypress, CA next to the Costco. For the first time it is clear that there is a box store toward the back of the new center. Bad location by design - restaurants under construction block the view. It seems really obvious this is yet another new Amazon Fresh.
I smell Fresh & Easy there.
This entire development on Cypress is bookended by two other strip malls with out of business box stores and mostly vacant restaurants. I guess they needed to construct more vacancies? There was a perfectly good Office Depot next door that is just as bad of a location as the new one. It has to be Amazon Fresh, drunk off the delusion that they will somehow leach business away from the ultra busy Costco next door by locating in a place that literally is 100% blocked from view by the Costco receiving area. Brilliant. And this wasn't off the ground yet when they mothballed the remaining unopened stores. So there is really no excuse for this. Maybe they can make it official and buy the F&E trademark from Burkle.
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Re: Amazon Halts All New Amazon Fresh Just Walk Out Stores

Post by Romr123 »

We just spent an hour or so visiting the E. Pasadena location. Visited on Monday around noon. Store not very busy---part of the parking lot was blocked off (unclear why). This store has the two-entrance (scan in/scan out or conventional entry/checkout). No sign of the "just walk out carts", just barcodes on all the carts.

As we don't use Amazon Prime the choice seemed obvious, but I guess you can just scan a credit card to enter the "just walk out" turnstile. OMG the number of cameras---they are literally on 24 inch centers, it seemed, through the entire place.

Produce was weirdly split up between sealed totes (2-3 lb bags of oranges/apples/etc) and individual pieces (which except for bananas at .15/apiece seemed very expensive...$1.19 apiece for rather meh-looking honeycrisp apples, for instance. We didn't grab any of the produce--seemed well cared for but weirdly unappealing. Dry grocery aisles were rather oddly assorted and laid out, with electronic shelf tags (allowing instantaneous price changes). The shelving was very rigidly sized so there was huge amounts of wasted space, plus everything seemed to be hand-stacked and hand placed (even things like canned soup).

I finally figured out what was so offputting--it's like it was set up by someone/to appeal to someone on the autism spectrum, with very straight lines and even stacks, even when things made no sense to be so carefully displayed.

There were a few people appearing to be restocking rather random items from specialized rolling carts with no cardboard boxes (i.e. everything had been removed in the back from the cases, arranged on the shelf, with backstock apparently above). Things weren't arranged together logically, and things weren't priced logically either (Goldfish crackers had 4 different prices for different varieties; Peet's Nespresso capsules had 3 different prices (different varieties were different prices, and were split up on a shelf with some Keurig capsules of another brand separating them). A very cheap item like plain envelopes were roughly comparable to dollar store pricing, but the letter size envelopes were displayed face-on to the aisle, when there was headspace to be placed on their short-side to save facing room (the small envelopes were stood on end).

The liquor section was carved out and supervised by someone to check age.

The hot deli/cold deli/pizza kitchen and service meat/service fish could have been lifted from WFM. Pizza was hot and fresh at 1 pm (I shudder to think about their shrink...they had 6 different pizzas on display). Hot bar looked good but untouched. Packaging for grab-and-go bakery items was way way way overkill--enormous clamshells for a 99 cent cookie or a 1.19 doughnut.

One woman ahead of us at checkout, unfortunately the landing area was too small for her order so upon completion the checker started handing us our order through the cough shield. Just awkward. The specials weren't handled uniformly (some came off at the time of scan, others at the totalization/payment).

TBH it was like viewing a traffic wreck--you can just see the concept swirling the drain. So entirely unsustainable and wasteful. We passed by two other locations (driving east from Pasadena, CA to the Inland Empire--the location in Laverne seemed open but one in Upland/Rancho Cucamonga wasn't yet open).
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Re: Amazon Halts All New Amazon Fresh Just Walk Out Stores

Post by storewanderer »

If you can go to the Long Beach location I will be really curious what you think of that.

I really had a different opinion of that location than the others I visited. The others I visited I share your opinions on, but they were also extremely poorly stocked/poorly executed.

Also you can use Just Walk Out with any Amazon Account, if you have a credit card on file with them. I'd never use it again since it doesn't give you a receipt for hours after you leave though.

Your observation about the straight lines and such is interesting. I wonder if they have it set up like that because either they used warehouse planners to plan the stores, they need it that way so the cameras can monitor what people take, and/or they are planning use of robotics and for those to be used they think they need that type of set up.
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Re: Amazon Halts All New Amazon Fresh Just Walk Out Stores

Post by BillyGr »

Romr123 wrote: February 20th, 2023, 8:41 pm The hot deli/cold deli/pizza kitchen and service meat/service fish could have been lifted from WFM. Pizza was hot and fresh at 1 pm (I shudder to think about their shrink...they had 6 different pizzas on display). Hot bar looked good but untouched. Packaging for grab-and-go bakery items was way way way overkill--enormous clamshells for a 99-cent cookie or a 1.19 doughnut.
We don't have pizza at the local supermarket, but they do do the hot chicken wings and other items (like mozzarella sticks or similar) bar, and that is only filled/available between 11am and 2pm, then again 4-7 pm.

So, these types of things must do OK in those what seem to be off hours (like when you saw the pizzas at 1pm), or they would have cut back on the hours they run them. Maybe just an area where people are looking for late(r) lunch or early afternoon snacks?
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Re: Amazon Halts All New Amazon Fresh Just Walk Out Stores

Post by ClownLoach »

storewanderer wrote: February 20th, 2023, 9:16 pm If you can go to the Long Beach location I will be really curious what you think of that.

I really had a different opinion of that location than the others I visited. The others I visited I share your opinions on, but they were also extremely poorly stocked/poorly executed.

Also you can use Just Walk Out with any Amazon Account, if you have a credit card on file with them. I'd never use it again since it doesn't give you a receipt for hours after you leave though.

Your observation about the straight lines and such is interesting. I wonder if they have it set up like that because either they used warehouse planners to plan the stores, they need it that way so the cameras can monitor what people take, and/or they are planning use of robotics and for those to be used they think they need that type of set up.
My understanding is that the Long Beach location has been the best performer in the chain since opening.
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Re: Amazon Halts All New Amazon Fresh Just Walk Out Stores

Post by Romr123 »

storewanderer wrote: February 20th, 2023, 9:16 pm If you can go to the Long Beach location I will be really curious what you think of that.

I really had a different opinion of that location than the others I visited. The others I visited I share your opinions on, but they were also extremely poorly stocked/poorly executed.

Also you can use Just Walk Out with any Amazon Account, if you have a credit card on file with them. I'd never use it again since it doesn't give you a receipt for hours after you leave though.

Your observation about the straight lines and such is interesting. I wonder if they have it set up like that because either they used warehouse planners to plan the stores, they need it that way so the cameras can monitor what people take, and/or they are planning use of robotics and for those to be used they think they need that type of set up.
I would no more trust Amazon to charge me correctly for what I was buying than the man in the moon--I was getting entirely discretionary stuff only because the price was unusually attractive, and was perfectly happy to have the checker void the order if the multi-buy stuff (Progresso soup, pizza/soda lunch special) wasn't working.
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Re: Amazon Halts All New Amazon Fresh Just Walk Out Stores

Post by ClownLoach »

Reading some forums, apparently all of the middle management for Amazon Fresh was eliminated in the layoffs. The stores do not have a District Manager, in fact there are no districts. Store Managers report directly to the head of stores, get help from head of HR, etc. in a direct supervision model. They think this will improve accountability somehow and improve their business; anyone who knows retail understands that less supervision means less performance so it must really be a cost cutting initiative. I think they are waiting for the end of the current quarter to give the stores the axe, because they booked the expense last quarter they will be able to credit back anything not spent on closing activities which could help this quarter's results. No supervision confirms that the stores are adrift, probably just taking directions from a consulting firm as previously discussed. I'm sure the consultants have a short deadline to show results or get lost.
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Re: Amazon Halts All New Amazon Fresh Just Walk Out Stores

Post by storewanderer »

I don't understand why they don't try to get some help from Whole Foods in terms of how to structure management in these stores. The other big problem is these Amazon Fresh Stores are very different. To me a "Just Walk Out" store is quite different from a "Dash Cart" store and given differences in customer flow, environment, liquor, unit pricing, and customer perception of the stores it almost seems like they need two different strategies depending which model the store is.

Then I assume some of these are doing better on foot traffic than others. Again, there is another spot where they need to segment these stores. Store with heavy pick traffic but weak foot traffic again need a different strategy/operational ideas.

They clearly are trying to cut expenses to the bare minimum at this time. What they do next is anyone's guess. We know where this route usually leads...
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Re: Amazon Halts All New Amazon Fresh Just Walk Out Stores

Post by ClownLoach »

storewanderer wrote: February 21st, 2023, 8:37 pm I don't understand why they don't try to get some help from Whole Foods in terms of how to structure management in these stores. The other big problem is these Amazon Fresh Stores are very different. To me a "Just Walk Out" store is quite different from a "Dash Cart" store and given differences in customer flow, environment, liquor, unit pricing, and customer perception of the stores it almost seems like they need two different strategies depending which model the store is.

Then I assume some of these are doing better on foot traffic than others. Again, there is another spot where they need to segment these stores. Store with heavy pick traffic but weak foot traffic again need a different strategy/operational ideas.

They clearly are trying to cut expenses to the bare minimum at this time. What they do next is anyone's guess. We know where this route usually leads...
Their statements to the public are that they are going to optimize this format to make customers love it, then get the zombie stores all opened, raise the "Mission Accomplished" banner, and take over the world. Their actions clearly are to just let the stores drift away with some minor, low level thinking tweaks from a consulting firm. The consultants who think adding a tiny "grocery store" sign to the pylon will magically add sales are really just there so Amazon can claim that they tried everything in their power to prevent having to take this $720M loss shutting it down. Paying a consultant to make pointless changes is just to prevent future shareholder lawsuits. Eliminating district leadership is the red flag. If they need to fix these stores to make them profitable they need more leadership and supervision to make the changes and turn the corner. My contacts were in the district HR sectors and all were let go. Now we know the DMs are gone too. A retail store without a DM breaks quickly. Sales, profit and execution will get even worse. Heck with districts in place there was no consistency of operation or standard. So again just sounds like they're biding their time trying to decide which quarter looks better to finalize the closure transaction, current quarter or start of next.

Anecdotal observation: Dash Cart stores have much better traffic and sales than Just Walk Out stores. And even if the carts cost $10K a piece right now (unsubstantiated rumor I heard) that is still way cheaper than the camera wiring jobs. There is no way that these lousy little stores with Just Walk Out are anything less than the most expensive to build grocery stores ever constructed on a per square foot basis. Again could be ten million or more for the cameras, wiring and expected server equipment in the back for Just Walk Out stores.
Last edited by ClownLoach on February 21st, 2023, 10:28 pm, edited 1 time in total.
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Re: Amazon Halts All New Amazon Fresh Just Walk Out Stores

Post by retailfanmitchell019 »

ClownLoach wrote: February 21st, 2023, 10:20 pm

Their statements to the public are that they are going to optimize this format to make customers love it, then get the zombie stores all opened, raise the "Mission Accomplished" banner, and take over the world. Their actions clearly are to just let the stores drift away with some minor, low level thinking tweaks from a consulting firm. The consultants who think adding a tiny "grocery store" sign to the pylon will magically add sales are really just there so Amazon can claim that they tried everything in their power to prevent having to take this $720M loss shutting it down. Paying a consultant to make pointless changes is just to prevent future shareholder lawsuits. Eliminating district leadership is the red flag. If they need to fix these stores to make them profitable they need more leadership and supervision to make the changes and turn the corner. My contacts were in the district HR sectors and all were let go. So again just sounds like they're biding their time trying to decide which quarter looks better to finalize the closure transaction, current quarter or start of next.
You summed it up perfectly.
At the end of the day, this all sounds like a repeat of Fresh & Easy. We all though Tesco would help run Albertsons out on a rail initially... :lol: :lol: :lol:
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