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 veteran+ »

J-Man wrote: February 3rd, 2023, 5:27 am
Bedford Marketplace, the new center, is in the right part of Corona for a Whole Foods, and if Amazon hadn't been trying to launch Fresh I would have expected the developer of that site to be courting WFM as their first choice to anchor it. So maybe it will be the first WFM in Riverside County to open.
There's a Whole Foods in Palm Desert.
Yep, and it's a nice one too! High volume store in the correct location. Not far from the weirdly located low volume WM Neighborhood Market 🤮

I was offered Store Manager but stupidly took Fresh & Easy's offer. :oops:
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Re: Amazon Halts All New Amazon Fresh Just Walk Out Stores

Post by ClownLoach »

J-Man wrote: February 3rd, 2023, 5:27 am
Bedford Marketplace, the new center, is in the right part of Corona for a Whole Foods, and if Amazon hadn't been trying to launch Fresh I would have expected the developer of that site to be courting WFM as their first choice to anchor it. So maybe it will be the first WFM in Riverside County to open.
There's a Whole Foods in Palm Desert.
Correction, Southwest Riverside County (the part they call "The I. E."). Somehow seems like Palm Springs/Palm Desert are excluded from that designation.
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Re: Amazon Halts All New Amazon Fresh Just Walk Out Stores

Post by ClownLoach »

norcalriteaidclerk wrote: February 2nd, 2023, 11:46 pm https://www.cnbc.com/2023/02/02/amazon- ... costs.html

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It's weird because when I looked at articles last night there was no clarity on closures. Then I saw the $720 Million write down "asset impairment" which validated my prior concern that they had spent far more money on this little Fresh adventure than we thought. Constant dollars are harder to track but in my head it sounds worse than the Fresh and Easy debacle which is hard to believe. When I was doing the math I was starting to realize that they had already signed so many leases that the exit cost could be in the hundreds of millions and this proves it. But that number is so, so high I expect to see a list of both Fresh and Whole Foods closing, with possibly more WFM than Fresh. And handling it this way financially probably meant that they are "imparing" the lease termination expenses on the quarter that had just ended "as if they already spent the money", but they didn't fully pull the trigger because they didn't want to have to take the rest of the write off now that their other businesses had pulled them into a slight profit of 3 cents a share. They have given really low profit outlook going forward which provides them a window to finish sending these stores to slaughter; they have effectively prepaid up to $720 Million in lease severance because they own enough of their own stock they would lose more with investor panic if they played the game set up of spinning the LLC and then having it immediately file bankruptcy. The bankruptcy would cost their stock far more than just being honest and paying the lease severances even though it totals 3/4 of a BILLION dollars. Amazon owns so much of their own stock that if their shares dropped a few bucks from panic about a subsidiary like Fresh going bankrupt the cost could be tens of billions.
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Re: Amazon Halts All New Amazon Fresh Just Walk Out Stores

Post by ClownLoach »

storewanderer wrote: February 2nd, 2023, 11:34 pm 2-3 Ralphs I know of closed in Murrieta about 10 years ago:
40545 California Oaks
40473 Murrieta Hot Springs Road
? Alta Murrieta Drive?

These stores ran real low volumes for years before closing. Prices were too high, conditions were poor, perimeters were not maintained to a typical Ralphs standard back then... really they were all bad representations of Ralphs. Of course the newer still open Murrieta Store and the newer Temecula Store were both fine (not convinced volumes were very high at those though either).

I think one of these may have dated back to the 80's though. All of these reminded me of the Menifee Ralphs (another dump) or the now closed Moreno Valley Ralphs.

Like you said the area was mostly dirt 25 years ago. Ralphs showed up quick and built stores that felt like early 90's stores. The area wasn't fully developed yet so perhaps the locations were not selected quite as well as they could have been. Other people showed up in the late 90's/early 00's and built much nicer more modern stores and were able to place those stores better for the local development patterns and Ralphs ended up out of business.
I know this thread is off topic. Anyway any change instead of Alta Murrieta drive it could have been Los Alamos drive? There is a building that looks suspiciously like a early 2000's Ralphs that is mysteriously half USPS, half Grocery Outlet that just opened. Then the Barons on Clinton Keith Rd in Wildomar - could that also have been a Ralphs? It's baffling how overstored Albertsons/Vons is in Murrieta and Temecula. The Asian population is also growing significantly and I'm sure H-Mart and 99 Ranch are both waiting to pounce on any closure that occurs. The new Murrieta Costco can't keep enough Asian items in stock and is already shifting to look more like the assortment you would see in Garden Grove or Cypress. I'm surprised that they haven't worked out a deal to offload one of these stores like they did with H-Mart in Irvine and Westminster.

It could be argued that some of these closed Ralphs sites are better than the three that remain in the valley. The Murrieta Ralphs is a pretty solid store and does good volume but it is on the fringe of the plateau. The Temecula Ralphs is also on the far southeast corner of the valley although it has nice enough neighborhoods nearby to turn into a Fresh Fare.
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Re: Amazon Halts All New Amazon Fresh Just Walk Out Stores

Post by storewanderer »

ClownLoach wrote: February 3rd, 2023, 10:53 am
I know this thread is off topic. Anyway any change instead of Alta Murrieta drive it could have been Los Alamos drive? There is a building that looks suspiciously like a early 2000's Ralphs that is mysteriously half USPS, half Grocery Outlet that just opened. Then the Barons on Clinton Keith Rd in Wildomar - could that also have been a Ralphs? It's baffling how overstored Albertsons/Vons is in Murrieta and Temecula. The Asian population is also growing significantly and I'm sure H-Mart and 99 Ranch are both waiting to pounce on any closure that occurs. The new Murrieta Costco can't keep enough Asian items in stock and is already shifting to look more like the assortment you would see in Garden Grove or Cypress. I'm surprised that they haven't worked out a deal to offload one of these stores like they did with H-Mart in Irvine and Westminster.

It could be argued that some of these closed Ralphs sites are better than the three that remain in the valley. The Murrieta Ralphs is a pretty solid store and does good volume but it is on the fringe of the plateau. The Temecula Ralphs is also on the far southeast corner of the valley although it has nice enough neighborhoods nearby to turn into a Fresh Fare.
This was a tough one but 39573 Los Alamos was a Vons from 1991-1995. I am guessing the post office moved in during 1995. I suspect the store was built too soon and density around there doesn't look great even now. It is funny how many early 90's era stores in Murrieta already failed. 2 Ralphs and 1 Vons- at least.

The situation with Albertsons in Murrieta and Temecula is due to both Lucky and Albertsons having multiple projects in development when that ASC merger occurred, and then Albertsons continuing with multiple new build stores after that. Yet they too did close some stores. Vons is it really much of a factor- they have that thing in Temecula that is a divested Albertsons from the ASC merger and I don't think it does much volume.
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Re: Amazon Halts All New Amazon Fresh Just Walk Out Stores

Post by norcalriteaidclerk »

https://www.bizjournals.com/seattle/new ... nings.html

Paywalled,but I bet it's sugar coated beyond the paywall.

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

Post by pseudo3d »

norcalriteaidclerk wrote: February 5th, 2023, 10:45 pm https://www.bizjournals.com/seattle/new ... nings.html

Paywalled,but I bet it's sugar coated beyond the paywall.

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https://archive.is/dUWSA
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Re: Amazon Halts All New Amazon Fresh Just Walk Out Stores

Post by Romr123 »

18 billion brick and mortar...sure Jan. Maaaybe if you roll all WFM into it...I doubt you get the number that high.
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Re: Amazon Halts All New Amazon Fresh Just Walk Out Stores

Post by ClownLoach »

Romr123 wrote: February 6th, 2023, 8:19 am 18 billion brick and mortar...sure Jan. Maaaybe if you roll all WFM into it...I doubt you get the number that high.
Whole Foods annual revenue for 2017 was $16.0 billion.
Their prices have increased significantly since then; I would not be surprised if the price increases outweigh the traffic declines as the offering deteriorated under Amazon.
So it is probably accurate that all of Amazon brick and mortar is $18 billion... it still leaves Fresh and Go as such insignificant operations that they effectively are a rounding error. I doubt these Amazon Fresh stores are pulling in close to $100K a week including deliveries in many cases.
I think that the $720 Million cash impairment sounds like enough to pay for the necessary lease terminations, severance and liquidation of all Fresh stores, including the unopened ones, plus write off all the equipment and other "goodwill" assets. Unless there is a wave of WFM closings coming, which I somehow doubt after several were purged last year, that is a lot of money to set aside.

The Amazon Fresh banner is already completely toxic and will not be able to be rescued. The zombie stores alone have created incredible badwill against the brand especially where Amazon bullied their way into the locations by outbidding existing stores for the lease. The article states that they are going to quickly find what does resonate with customers. I would imagine they will have to either acquire or create a new nameplate for a new banner, and I also am going to assume the word "Amazon" is going to get left out this time. Maybe they will make a store under some variation of the "Prime" brand?
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Re: Amazon Halts All New Amazon Fresh Just Walk Out Stores

Post by buckguy »

ClownLoach wrote: February 7th, 2023, 5:46 pm
Romr123 wrote: February 6th, 2023, 8:19 am 18 billion brick and mortar...sure Jan. Maaaybe if you roll all WFM into it...I doubt you get the number that high.
Whole Foods annual revenue for 2017 was $16.0 billion.
Their prices have increased significantly since then; I would not be surprised if the price increases outweigh the traffic declines as the offering deteriorated under Amazon.
So it is probably accurate that all of Amazon brick and mortar is $18 billion... it still leaves Fresh and Go as such insignificant operations that they effectively are a rounding error. I doubt these Amazon Fresh stores are pulling in close to $100K a week including deliveries in many cases.
I think that the $720 Million cash impairment sounds like enough to pay for the necessary lease terminations, severance and liquidation of all Fresh stores, including the unopened ones, plus write off all the equipment and other "goodwill" assets. Unless there is a wave of WFM closings coming, which I somehow doubt after several were purged last year, that is a lot of money to set aside.

The Amazon Fresh banner is already completely toxic and will not be able to be rescued. The zombie stores alone have created incredible badwill against the brand especially where Amazon bullied their way into the locations by outbidding existing stores for the lease. The article states that they are going to quickly find what does resonate with customers. I would imagine they will have to either acquire or create a new nameplate for a new banner, and I also am going to assume the word "Amazon" is going to get left out this time. Maybe they will make a store under some variation of the "Prime" brand?
The brick and mortar excludes online orders picked-up at Whole Foods: https://www.winsightgrocerybusiness.com ... iscal-year so it is probably difficult to compare where they are now vs. 2017.

The same posting linked above suggests that the 18K job cuts are not as centered in brick and mortar as suggested previously and it doesn't sound like Whole Foods would be affected.

The 30 stores/year thing sounds like pure pr even if they really do have 50 stores in the pipeline. I wouldn't be surprised if some of them are Amazon Fresh locations that get launched as Whole Foods.
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