Amazon Shifts Grocery Strategy: Closure of Fresh and Go Stores

Amazon.com Inc. has announced the closure of all its Amazon Fresh and Amazon Go physical stores, marking a significant shift in its grocery strategy. The decision, revealed in a company blog post, will see 72 locations nationwide closed, with some being converted into Whole Foods Market stores. The closures are set to take effect on February 1, 2026, with California locations remaining open for an additional 45 days to comply with state regulations.

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Amazon cited a lack of a "truly distinctive customer experience" and an unsustainable economic model as primary reasons for the closures. Despite some encouraging signals from its physical grocery stores, the company acknowledged that it had not achieved the necessary sales figures for large-scale expansion. Neil Saunders, a retail analyst with GlobalData, noted that the Fresh and Go stores were not generating the growth trajectories required for sustainability.

Amazon Is Closing Its Fresh Grocery, Go Convenience Stores

The closure of Amazon's own grocery stores signals a strategic pivot towards Whole Foods Market and online grocery delivery. Amazon plans to open over 100 new Whole Foods locations in the coming years and expand its Whole Foods Daily Shop format. The company has reported a 40% increase in sales at Whole Foods since its acquisition in 2017, now operating over 550 locations.

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Amazon's online grocery service has also seen substantial growth, with gross sales exceeding $150 billion annually and same-day delivery of perishables expanding to 2,300 U.S. cities. The company aims to capitalize on this momentum by focusing on its delivery capabilities rather than maintaining its own branded grocery stores.

Amazon to convert select physical stores into Whole Foods, expand same-day delivery

The closure of the Fresh and Go stores will result in job losses for thousands of hourly workers. Amazon has stated that it will assist affected employees in finding new roles within the company, including positions at Whole Foods or in its logistics network. The company is also preparing for corporate layoffs, which are expected to occur soon.

Amazon Is Closing Its Fresh Grocery, Go Convenience Stores

Despite the closures, Amazon remains committed to physical retail, indicating that it will continue to experiment with new store formats. This includes a planned 230,000-square-foot supercenter in Orland Park, Illinois, which will combine groceries with general merchandise.

Amazon closing all Amazon Fresh and Go stores to focus on Whole Foods and grocery delivery

In its announcement, Amazon emphasized that the decision to close the stores is not a retreat from the grocery sector but rather a strategic shift to prioritize growth areas. The company stated, “After careful evaluation of the business and how we can best serve customers, we’ve made the difficult decision to close our Amazon Go and Amazon Fresh physical stores.”

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• “While we’ve seen encouraging signals in our Amazon-branded physical grocery stores, we haven’t yet created a truly distinctive customer experience with the right economic model needed for large-scale expansion,” — Amazon spokesperson

Amazon Is Closing Its Fresh Grocery, Go Convenience Stores

• “The main reason behind the decision is that neither Fresh nor Go stores were delivering the sales needed to make them fully economic,” — Neil Saunders, Retail Analyst

Amazon Is Closing Its Fresh Grocery, Go Convenience Stores

Amazon's closure of its Fresh and Go stores represents a significant recalibration of its grocery strategy, focusing on the more successful Whole Foods brand and enhancing its online grocery delivery services. As the company navigates this transition, it aims to leverage its existing strengths while continuing to explore new retail concepts.

Amazon Fresh Stores Closing As Amazon Focuses on Whole Foods, Delivery