Amazon's New Grocery Store in Irvine to Boost Retail Presence

Amazon AMZN is firing on all cylinders to expand footprint in the retail sector on the back of strengthening grocery business and growing physical presence.

Reportedly, the e-commerce giant is planning to open a new grocery store in Irvine, CA.

This is in line with the company’s aim of opening a new chain of grocery stores, with the intention of further disrupting the retail space.

Notably, the first one is set to open in Los Angeles. These stores will be stocking a wider variety of items than Whole Foods stores from different categories such as grocery, health and beauty products. This in turn will provide customers with more options.

Amazon.com, Inc. Price and Consensus

 

Amazon.com, Inc. Price and Consensus

Amazon.com, Inc. price-consensus-chart | Amazon.com, Inc. Quote

Deepening Retail Focus

Amazon’s latest plan bodes well for its retail strategies that include bolstering retail presence, strengthening distribution strength and enhancing shopping experience for customers.

Late last year, the company announced plans to open Amazon Go supermarkets. Amazon is striving to service supermarket stores as large as 30,000 square feet with the cashierless technology.

Growing proliferation of AI, ML and Internet is likely to drive the company’s cashierless concept. With its cashierless supermarket, Amazon is likely to revolutionize the retail industry.

In addition to the supermarket initiative, the company rolled out a new line of pop-up stores with rotating themes this January. These stores can be set up faster than a full-fledged Amazon Go store. This in turn will likely aid the company in strengthening presence in malls and sport stadiums.

Amazon bookstores have expanded to a dozen of U.S. cities, thereby strengthening its retail presence.

We believe all these endeavors bode well for the company’s retail initiatives.

Intensifying Retail Battle

Amazon’s aggressive stance on the core retail industry — especially on grocery retail — continues to put competitive pressure on brick-and-mortar stores as well as big retailers like Walmart WMT, Target TGT and Kroger KR, to name a few.These big retailers are already bearing the brunt of Amazon’s well-performing online retail platform and robust grocery services.

However, in order to counter Amazon’s competitive threat, all these companies have ramped up initiatives to strengthen their delivery and pick-up services.

Nevertheless, Amazon’s rapidly expanding grocery pickup and delivery services, along with the availability of Prime Savings at all Whole Foods Stores and Whole Foods Market 365 stores across the United States remain key catalysts.

Zacks Rank

Currently, Amazon carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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