Posted On News

Amazon Shifts Grocery Strategy: Delivery Expansion and Whole Foods Growth

Amazon (AMZN) is making a major shift in its grocery strategy, doubling down on fast grocery delivery and Whole Foods Market expansion while closing its Amazon Fresh and Amazon Go brick-and-mortar stores across the U.S.

The company confirmed it will close roughly 70 Amazon Fresh and Amazon Go locations, consolidating its physical grocery footprint under the Whole Foods Market brand. Some of the closed locations will be converted into Whole Foods stores, with more than 100 new Whole Foods Market locations planned over the next several years.

Amazon Closing Amazon Fresh and Amazon Go Stores

Amazon said that while it saw some positive signs at Amazon Fresh and Amazon Go stores, the formats failed to deliver a distinctive customer experience with a scalable economic model.

As a result:

  • Amazon Fresh and Amazon Go physical stores will close
  • Select locations will be converted into Whole Foods Market stores
  • Employees will be offered opportunities to transition into other Amazon roles when possible

Despite the closures, Amazon emphasized that its grocery business remains strong, generating over $150 billion in gross sales annually and serving more than 150 million grocery customers.

Grocery Delivery Expansion to More Communities

Amazon continues to see strong demand for online grocery delivery, especially for fresh food and everyday essentials. Currently, Amazon offers grocery delivery in more than 5,000 U.S. cities and towns, including thousands with Same-Day Delivery.

Key delivery highlights include:

  • Expansion of Same-Day Delivery for fresh groceries in 2026
  • Ability to shop produce, meat, dairy, bakery, and frozen foods alongside millions of Amazon items
  • Perishable grocery sales through Same-Day Delivery have grown 40x since early 2025
  • Fresh groceries now represent 9 of the top 10 most-ordered items in eligible areas

Amazon is also testing Amazon Now, an ultra-fast delivery option that delivers thousands of essential items—including fresh food—in 30 minutes or less in select cities.

Whole Foods Market Expansion Accelerates

Amazon is significantly increasing investment in Whole Foods Market, which has grown to over 550 locations and seen more than 40% sales growth since Amazon’s acquisition.

Expansion plans include:

  • 100+ new Whole Foods Market stores over the next few years
  • Growth of the Whole Foods Market Daily Shop format, a smaller, convenience-focused store
  • Five additional Daily Shop locations planned by the end of 2026

Whole Foods Market Daily Shop focuses on grab-and-go meals, coffee, and everyday essentials, offering a faster neighborhood shopping experience while maintaining Whole Foods’ quality standards.

What This Means for Shoppers

Amazon’s move signals a clear priority:

  • Fewer experimental physical grocery formats
  • More investment in delivery speed, convenience, and Whole Foods Market

Customers can still shop Amazon Fresh online in eligible areas and benefit from faster delivery, broader selection, and improved reliability.

Bottom Line:
Amazon is exiting Amazon Fresh and Amazon Go physical stores while aggressively expanding grocery delivery and Whole Foods Market locations. The strategy reflects changing consumer behavior, with shoppers favoring fast delivery and trusted grocery brands over experimental in-store concepts.

Similar Posts