Amazon is closing its Amazon Go and Amazon Fresh physical stores

RIP, Amazon stores: gone and probably soon forgotten.

Amazon announced Tuesday that it will close its Amazon Go and Amazon Fresh stores, and will instead expand its same-day grocery delivery capacity, as well as its Whole Foods Market footprint.

These stores have been used to grow Amazon’s cashless Just Walk Out technology, which tracks the items customers pick up, allowing them to pay for their groceries without a more formal checkout process. The company is instead focusing on offering this technology to third parties, such as concession stands at sports stadiums.

“While we have seen encouraging signs in Amazon-branded physical grocery stores, we have not yet created a truly differentiated customer experience with the right economic model needed to scale at scale,” the company wrote in a blog post.

These retail store closures will not affect customers who use Amazon for grocery delivery.

It’s not surprising that Amazon is divesting from its branded retail stores, given that Amazon has been shrinking its brick-and-mortar retail presence over the past few years. When closing some stores in 2024, an Amazon spokesperson said the company “couldn’t make the economy work at the cost of rent.”

However, Amazon is not abandoning the physical side of its business. Instead, it will embrace the fact that people have a stronger association with the Whole Foods Market brand than they do with the Amazon Go convenience store.

Amazon will open more than 100 new Whole Foods stores over the next few years. Whole Foods has seen sales growth of more than 40% and expansion to 550 stores since it was acquired by Amazon in 2017, the company says.

Amazon also plans to open more Whole Foods Market Daily Shop locations — a smaller version of the grocery store with a focus on convenient meals and grab-and-go meals. This sounds similar to the idea behind the Amazon Go and Amazon Fresh stores, but maybe people will feel better eating a salad from Whole Foods instead of an Amazon Fresh store… even though they’re the same company.