Online retail colossus Amazon has been moving into bricks-and-mortar in a big way and could be experimenting with robot-powered grocery stores that would need just three humans to operate.
In a story published Sunday, the New York Post reported Amazon is prototyping a grocery store in which robots would retrieve and bag items for shoppers on one floor, with another floor for products shoppers like to touch before buying.
The stores could be as big as 40,000 sq. ft. and sell a full range of products from fresh fruit and vegetables, to eggs and meat, beer and wines. The stores could operate with an average of six employees, though they could run with as few as three staff and, at most, 10 employees per location. The Post story quotes sources “briefed on the plans,” though Amazon denied it is working on a robot-powered grocery store. “We have no plans to build such a store,” was the response to the Post.
That may be the official line, but it’s not hard to believe Amazon could in fact be quietly experimenting with ways to revolutionize the grocery experience.
Amazon has a reputation as a front-runner on robotics and automation, with impressively choreographed robots powering massive distribution centres and it seems only a matter of time before drones are air-delivering packages to our front doors. (Last year the company filed a patent for a massive flying warehouse from which those drones could be deployed.)
In December it unveiled Amazon Go, a retail concept offering what it called a “just walk out” shopping experience. Shoppers equipped with the Amazon Go app place items in their cart, Amazon technology keeps track of everything and when the shopper is done, they just walk out: no lineups and no checkout.
And, both Business Insider and the Wall Street Journal reported last year that Amazon is planning to open 2,000 Amazon grocery stores, though here too Amazon denied the claims telling the WSJ it had “no plans to open 2,000 of anything. Not even close. We are still learning.”
According to the New York Post, the Amazon prototype would generate profit margins of better than 20%, compared to the industry standard of 1.7%. Citing data from the Food Marketing Institute, the Post said the U.S. grocery industry employed 3.4 million people in 2015 with the average grocery store employing 89 people and generating revenue of $2 million.