Previously, documents filed with the Seattle planning department did not name Amazon as the company responsible for the proposed 9,700 square foot drive-through grocery facility in the city’s Ballard neighborhood. This application for the same address, however, lists Amazon as the proprietor. Based on the city planning documents, most of the facility’s space will be devoted to food storage. All ordering for the store will be done online, and then customers are given a window of time between fifteen minutes and two hours long, in which they can drive by and have their groceries delivered to their cars.
Customers who choose to walk in will be able to order from electronic tablets that will be provided and then wait in a designated “retail room” where their orders will be brought to them.
The Seattle company is also rumored to be working on similar sites, one south of downtown Seattle and two in Silicon Valley, but this location in Seattle’s Ballard neighborhood is the closest to completion.
Amazon has a good chance of making it as a grocery store
Rupesh Parikh, an analyst at Oppenheimer & Co. Inc., observes that Amazon has already done a good job of making people buy things that they previously would not have dreamed of buying online. Groceries are the next thing that people will begin to buy online and Amazon is setting themselves up to be at the forefront.
According to Roger Davidson of the Oakton Advisory Group, Amazon’s new store will be much better than other grocery stores that offer drive-through options.
Opening a Grocery Store is a logical step for Amazon. Having grocery store locations will allow them to capitalize on a market in which they already have a strong foothold.
Half of the people who buy groceries online have an Amazon Prime accounts.
The Ballard neighborhood, in Seattle’s north end, is popular with workers in various tech industries and is therefore well positioned to take advantage of the growing trend towards online ordering.
The rise of online grocery shopping
Amazon is not the first company to offer online grocery shopping.
Walmart offered curbside grocery pickup at a Walmart in San Jose in 2011 and opened its first stand-alone drive-thru grocery pickup site in Bentonville, Ark. in 2014. Walmart's move into online sales was one of the reasons that the company has seen profits rise in the fourth quarter of last year. As well, there are other stores and chains around the United States that have similar services.
The findings of NPD Group show that nearly six percent of people do at least some of their grocery shopping online. Much of this, however, has been for items such as canned and packaged goods and non-perishables. The challenge, says Parikh, will be convincing customers to buy items such as meat and fresh vegetables. For these items, customers often prefer to see or feel for themselves before buying.
