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Bloomberg: Amazon Reportedly Mulling 3K Amazon Go Stores By 2021

Bloomberg: Amazon reportedly mulling 3K Amazon Go stores by 2021

Dive Brief:
Amazon is reportedly mulling a plan to open up to 3,000 Amazon Go locations by 2021 in major U.S. metropolitan areas, a likely multi-billion investment that could make the e-commerce giant one of the largest operators of convenience stores, people familiar with the matter told Bloomberg. Amazon declined to comment to the publication.

Up to 10 Amazon Go stores could open before the end of 2018, 50 by next year and 3,000 by 2021, the people told Bloomberg.

The sources also said that Amazon spent at least $1 million on the technology hardware alone that was deployed in its first Amazon Go store in Seattle, which opened to the public in January 2018.

Dive Insight:
If you were impressed (or terrified) with Amazon’s debut of three new Amazon Go stores in the span of three weeks, how does 3,000 over the next three years or so sound?

That kind of expansion in just the next few years would be a huge bet — and a potentially risky one, even for a trillion-dollar company.

Even if the cost of opening Amazon Go stores continues to come down rapidly as Amazon refines its model and its technology, it still likely would cost at least several billion dollars to build out, open and promote 3,000 new stores. Amazon has remained quiet about the performance of its existing Go stores.

It is of course possible that Amazon ultimately decides on a more conservative number of stores. Jeff Bezos has previously stated that he’s only interested in opening up brick-and-mortar stores if they can bring something new to the table.

Operating a convenience store is not a new idea, but operating a checkout-free convenience store that focuses largely on freshly-prepared, ready-to-eat meals for commuters is new. But, new or not, customers need to embrace the concept for it to matter. And, nothing stays new for very long. Operators of similar stores may be wise to follow Amazon down this path to whatever extent they can. Then we’ll see how serious the company is about racing toward ubiquity for Amazon Go.

Source: Retaildive

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