Amazon Plans To Expand Online Grocery Business

Posted: Jun 5 2013, 2:33am CDT | by , in News | Misc

Amazon Plans to Expand Online Grocery Business

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Although the online grocery business is still in its experimental stages, Amazon is willing to give it a shot. In fact, it is looking forward to expanding its online grocery business all the better to fulfill the fresh food requirements of consumers.

Amazon has since the past decade or so kept up an online experimental grocery store of sorts by the name of Amazon Fresh. This cyber-grocery caters to customers based in Seattle. However, now it is ready to expand to include other places like Los Angeles and San Francisco. Within the future plans lie over 20 other markets and many of them will exist outside the United States. This will take a year or two to materialize according to Reuters. Until then all eyes are set on the two signature stores beyond the Seattle market. The profits that are to be reaped via grocery goods are beyond anyone’s imagination. There is a huge market niche to be exploited based on the green grocer’s fresh produce.

While Amazon Fresh earned some pretty hefty sums in its previous years it has recently come up against a few snags along the way. This has caused stock analysts to say that it is a losing game. The fact of the matter is that grocery has never prospered as an online phenomenon. When you look at companies like Wal-Mart or Whole Foods you realize that they have always relied on tried-and-tested methods of sales and delivery. Whether the same thing will stimulate consumer demand in an online milieu is another matter. There is the obvious question of where the company will keep its fresh goods so that they remain fresh. Silo containers or refrigerated trucks come to mind but still it is a headache to keep so many choice goods in mint condition for customers.

Amazon does have all the resources in the world to tackle this problem. It can allocate these resources towards solving the issue at hand. Its former experience will undoubtedly help it in this regard. But seen from another angle the whole scenario is new and therefore it will require a different tack. You can’t put old wine in new bottles. New wine requires new bottles. Therefore a novel strategy will have to be designed to firstly keep the goods in perfect condition and secondly deliver them such astronomical distances from the original site. As a worldwide leader in products ranging from books to music CDs to electronic goods, Amazon keeps its consumer durables in warehouses and delivers them to consumers with alacrity and promptness. How this experiment will fare in case of groceries remains to be seen.

Image Credit: Getty Images

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<a href="/latest_stories/all/all/20" rel="author">Sumayah Aamir</a>
Sumayah Aamir (Google+) has deep experience in analyzing the latest trends.




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