Amazon is set to close all 19 of its UK Amazon Fresh grocery stores less than five years after launching the till-free sites in London. Five of the stores may be converted into Whole Foods outlets, another grocery brand owned by Amazon.
The closures will affect around 250 staff, and the company has started a consultation process regarding its plans. Amazon has said it will be aiming to redeploy as many staff as possible.
Amazon opened its first UK grocery store in Ealing Broadway in March 2021. Shoppers at Amazon Fresh used a “walk in, pick up, and walk out” model, with purchases billed automatically to their Amazon accounts using in-store cameras and other technology.
Why Amazon is making the change
Amazon said the decision followed a “thorough evaluation” of its operations and the growth potential of online grocery delivery. The company plans to focus on its delivery services, working with partners including Morrisons, Co-op, Iceland, and Gopuff.
Industry analysts suggest the physical stores struggled to offer a differentiated experience. Sucharita Kodali of Forrester commented that Amazon Fresh may not have been set up for success, with issues including store locations and an unproven model in a highly competitive grocery market.
Danni Hewson at AJ Bell noted that the till-less technology “always felt a little awkward,” and feels that Amazon’s strength lies in delivery convenience rather than in-store shopping.
What lessons are there to take?
Amazon’s decision highlights several practical points that can be helpful to businesses of all sizes.
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Test new ideas, but don’t get too attached - trying new approaches is good, but be ready to change or stop them if they aren’t working. Amazon’s rapid pivot shows that even huge companies adjust quickly when their experiments don’t deliver.
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Play to your strengths - focus on what your business does best. Amazon is closing stores to concentrate on online delivery, an area where it already has a clear advantage. Think about where your own strengths lie and build on them.
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Innovations need to have a practical benefit - technology alone isn’t enough. While till-less stores demonstrated how technology can work, they didn’t really solve anything customers needed. Any new system or process should be simple, useful, and solve a real problem for your customers.
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Be flexible and ready to adapt - markets change quickly. Watch customer behaviour and your competition and be prepared to tweak your approach rather than sticking rigidly to a plan that isn’t working.
Amazon’s decision to close its physical stores highlights an important lesson for all businesses: success often comes from focusing on your strengths, staying agile and responding quickly to changes in the market. While not every experiment will work, each one provides valuable insight that can help you refine your strategy and grow.
For business owners, the key takeaway is to keep evaluating what’s working, identify opportunities to innovate, and make sure your operations are aligned with where you can truly add value. If you want support in assessing your business strategy, planning for growth, or navigating change effectively, give us a call. We would be happy to help you!
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