Amazon Launches New Line Of High-Tech Grocery Stores, Starting With Los Angeles

Amazon.com, Inc AMZN announced Thursday it is launching a new grocery store chain, in addition to the Whole Foods stores it already operates.

What Happened: Located in the Woodland Hills neighborhood of Los Angeles, the first Amazon Fresh grocery store will begin operating this week, the retail giant said in a blog post.

Initially the store will serve customers by invitation only, and full public access will be allowed in the coming weeks, according to the Seattle-based company.

Amazon said the store will have a type of shopping cart that will allow customers to skip lining up at the register, and also feature Alexa to help them manage their shopping lists.

In 2017, the e-commerce giant purchased Whole Foods Market, Inc for $13.7 billion. 

“Whole Foods is a longstanding pioneer and leader in natural, organic and clean foods. Amazon’s Fresh selection is fairly different. We see them operating next to one another and we’re excited to offer customers the choice between the two,” Amazon Fresh’s vice president Jeff Helbling told CNBC.

Why It Matters: Amazon Fresh’s mix of in-store shopping and online retail brings Amazon into direct competition with The Kroger Co KR and Albertsons Companies, Inc ACI, CNBC reported.

The tech and retail behemoth is expanding its physical store portfolio even as the world is reeling from the COVID-19 pandemic. 

The company’s grocery sales have risen three times year-over-year in the second quarter and it had upped its grocery delivery capacity by more than 160%, CNBC reported last month.

The retail giant is also expanding its offices in six major U.S. cities amid pandemic, as it plans to bring employees back to their desk, a stance in contrast with other major tech firms such as Facebook Inc FB, Alphabet Inc GOOG GOOGL and Twitter Inc TWTR, which are allowing employees to work from home.

Price Action: Amazon shares traded 0.55% lower in Thursday’s pre-market session at $3,423.

Photo courtesy: Amazon.com Inc.