Amazon shutters 4 Fresh stores in Southern California as grocery strategy keeps shifting

Amazon is set to close four Fresh supermarket locations in Southern California as part of its evolving grocery strategy, which increasingly centers on Whole Foods and delivery services. The closures are expected to occur in the upcoming weeks, as confirmed by the company to CNBC. This decision comes on the heels of previous shut-downs at four other U.S. locations, including those in Washington, Virginia, New York, and a suburb of Los Angeles. An Amazon spokesperson, Griffin Buch, stated, "Certain locations work better than others, and after an assessment, we've made the decision to close these Amazon Fresh locations." The company is committed to assisting affected employees in finding new roles within the organization whenever possible. During an all-hands meeting at a Fresh store in La Verne, California, employees were informed that the store would close by mid-November and that they would receive severance packages. The other three locations slated for closure are in Mission Viejo, La Habra, and Whittier. In addition to these U.S. closures, Amazon plans to shut 14 Fresh grocery stores in the U.K. and convert five others into Whole Foods markets. The company routinely evaluates its store portfolio, which may result in openings, relocations, or closures. Despite these changes, Amazon still operates over 60 Fresh stores in the U.S. Notably, the company had previously removed its "Just Walk Out" cashierless technology from these locations and has reduced its number of Go cashierless convenience stores. Since launching Amazon Fresh in 2007 as a fresh food delivery pilot, the company has been striving to establish a significant presence in the grocery market. Amazon's Fresh grocery chain was introduced in 2020 to attract mass-market shoppers, but its expansion has faced challenges amid broader cost-cutting measures under CEO Andy Jassy, particularly in response to rising interest rates and inflation. In 2023, Amazon announced a halt on new openings while it re-evaluates how to better position the chain in the competitive grocery landscape. While closing some Fresh stores, Amazon continues to invest in grocery innovations aimed at making shopping easier and more affordable. The company maintains a strong presence with 500 Whole Foods locations and has introduced mini "daily shop" formats in New York City. Recently, Amazon launched a new budget-friendly grocery brand available both online and in-store and expanded same-day delivery for fresh foods across more U.S. regions. Jassy has expressed optimism about grocery sales, emphasizing the importance of everyday essentials in the company's online grocery business.