The Washington Post reports that hundreds of store employees working at the 44 Amazon Fresh stores around the country have been laid off and told that the moves were part of a “cost reduction.”
According to the story, “The positions being cut are ‘zone leads’ who manage sections of individual stores, according to three former Amazon Fresh employees who spoke on the condition of anonymity to protect their careers.”
In a statement, the Post reports, “Amazon spokesperson Jessica Martin said the company is making changes as it evaluates Amazon Fresh’s performance. ‘As a result, we’ve decided to evolve our in-store staffing and operations model to better serve our customers and teams … We remain committed to our grocery business, and we’re working closely with affected employees to help them find new shifts or roles within Amazon’.”
Some context from the Post piece:
“Amazon launched Amazon Fresh as a delivery-only brand in 2007. Ten years later, it acquired Whole Foods for $13.7 billion, hoping to learn how to successfully operate a grocery chain. In 2020, it began opening physical Fresh stores, including more than a dozen in the United Kingdom.
“But recently, Amazon has been reevaluating that expansion. As the tech giant has tried to rein in growth and cut costs following the online shopping frenzy at the height of the coronavirus pandemic, it has laid off thousands of workers, reorganized its logistics network, and killed various projects and divisions. In spring 2022, Amazon announced that it was scaling back in retail, eliminating Amazon Books and 4-Star stores, and reducing the number of Amazon Go convenience stores.
“Amazon CEO Andy Jassy has said the company is committed to making grocery work. But in an earnings call this year, he said the company would pause the opening of new physical Fresh locations while it reevaluates strategy and tries to find a way to turn Amazon Fresh into a financial success.
“The job eliminations at Amazon Fresh come in the midst of a year of job cuts throughout the tech industry. Amazon has so far laid off 27,000 workers in 2023, making deep cuts in human resources, advertising, gaming and even its core moneymaking division: cloud computing.”
KC’s View:
The argument here for a long time has been that most Amazon Fresh stores that I’ve visited have seemed like dark stores that just happen to be open to the public. I’ve never been to one that actually has been busy with customers, and they tend to have more staffers shopping the store to make deliveries or for customer pickup than actual, real-life shoppers. (This may have as much to do with when I’ve been in these stores as anything, but it has been my consistent experience.)
Eliminating people from the equation won’t make these stores more personable or more shoppable – I expect it will just exacerbate a problem that I’ve commented on here numerous times. Amazon Fresh stores largely seem to suffer from nobody-gives-a-damn disease, and now there will be fewer people to give a damn.
Not to mention there seems to be nobody at the top of this particular food chain who has a vision for what Amazon Fresh should be, how it should be relevant to and resonate with shoppers, how it should fit into the broader Amazon ecosystem, and how to communicate all this effectively to the people who work there, creating a passion for food and customer service.
I’ll say it again. I don’t think it will happen, but would anybody be really surprised if Amazon just decided to get out of the bricks-and-mortar food business, closed up all its Fresh and Go stores and sold Whole Foods? Tom Furphy makes the point that getting grocery right always has been a key element in Amazon’s plans for world domination (my choice of words, not his), but it also is possible that under the current regime, those ambitions have been put on the back burner, or taken off the stove entirely.
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