It’s all over for the so-called checkout-free grocery store.

Sainsbury’s – JWO’s first international customer – has pulled the plug on its sole store in London. Tesco’s GetGo stores now have a self-checkout option. Aldi is struggling to make its one cashierless store work. Other adopters are limiting its use to travel shops and stadiums. Even Amazon is stripping out the tech from its larger US stores. How long before Amazon Fresh follows suit here in the UK? A number of Amazon Fresh stores have closed (including the original store in Ealing) and it’s only opened one new one in the past 12 months. 

So what’s behind the underwhelming performance of the tech Amazon once claimed would “redefine retail”? As I’ve argued from the get-go it’s just not that frictionless. Customers must typically download, sign up, then open an app and scan a QR code. Invariably it needs at least one attendant to help. Shoppers might even have to stump up a fee – as we reported last week Aldi has started charging shoppers £10 just to enter the store, to stop shoppers from just walking out – without paying, that is. You don’t need to be a mind reader to predict how that will go down, or what happens next. 

Then on exit, there’s that nagging unease for shoppers: anxiety they may have been overcharged, or guilt they may have been undercharged (although as we saw in The Grocer’s exclusive survey on self-checkouts last week, guilt among shoppers who can get away without paying is relative).

For retailers there’s a huge initial capex, and in Sainsbury’s case, no doubt, significant ongoing fees. The minor labour savings – shelves still need to be restocked after all – quickly diminish on balance.

The self-checkout, on the other hand, feels just the right level of automation. And as the likes of Sainsbury’s are moving on (or back) to self-checkouts, it leaves a question hanging over the future of Amazon Fresh.

Given JWO was once Amazon’s USP in physical grocery, its killer app, what is Amazon Fresh for? It’s a sub-scale convenience offer (21 stores), with similar products (own-label ready meals are now supplied by Morrisons) and similar prices to its rivals (and unlike rival loyalty schemes the discounts for Prime members don’t require a subscription). Amazon thinks ‘scan as you go’ – integrated into a shopping trolley – is the future but research for The Grocer shows that’s of limited interest for shoppers. Meanwhile Tony Hoggett, Amazon’s SVP of worldwide grocery stores, has jumped ship to New York dine-in and delivery business Wonder. When he told The Grocer back in 2023 “not everything you do in grocery needs reinventing” he wasn’t wrong.

It makes you wonder what Amazon does next under new global grocery boss Jason Buechel. Does it stick (to its knitting in online non-food)? Or twist, buying a convenience or supermarket chain or even Ocado to achieve scale? There is, after all, a more sympathetic Competition & Markets Authority, now chaired by, er, ex Amazon UK chief Doug Gurr.

It’s hard to tell from Amazon’s Q4 earnings this week just how much money its grocery operations are making (or losing). And outside grocery its e-commerce model is facing increased competition from, among others, Tesco’s burgeoning Marketplace, which arguably offers more quality control, and Clubcard points.

So: if Just Walk Out is dead, Just What Now?

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