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Business Insider reports that internal documents at Amazon suggest that the company has fallen behind its plans "to open hundreds of cashierless Fresh grocery stores by 2023."

According to the story:  "In a planning document from June 2020, Amazon projected these cashierless stores, internally codenamed 'Grace,' to go from zero to 33 in 2021, 280 in 2022, and 580 in 2023 in the US. That includes an adjustment made to reflect a more 'pessimistic scenario' because of a second wave of COVID-19 late last year, and retrofitting existing Fresh locations to add cashierless capabilities by the second quarter of 2022. A separate document from March 2021 mentions the same store projections for this year.

"So far, the internet giant has only opened one cashierless Fresh grocery store in the US. It's unclear whether the projections have been revised … The aggressive goal offers both a roadmap and a cautionary note for Amazon's lofty ambitions in the grocery retail space. Even if it gets close to the 580 Fresh store total, the company would still lag behind major grocery competitors. Walmart, for example, has over 10,500 stores. Target operates 1,915 stores in the US, and Albertsons runs over 2,200 supermarkets in the country. Amazon-owned Whole Foods has over 500 stores in North America and the UK."

The Business Insider story goes on:  "The vast expansion effort comes as Amazon anticipates huge cost reductions in the Just Walk Out technology powering the cashierless Fresh stores. Amazon projects the annual tech operating cost for each of those stores to drop by almost 75% between 2020 and 2023, making it easier and more affordable to scale, according to an internal document from August 2021.

"Amazon plans to put the Just Walk Out technology into every future Fresh grocery store going forward. All sites are expected to come equipped with the cashierless technology, while all existing non-cashierless Fresh stores will be retrofitted by the second quarter of 2022, according to one of the documents."

KC's View:

Just because Amazon may not have met its original deadlines, I don't think that necessarily suggests any lessening of nits commitment to the technology or physical retailing.  After all, it has been a weird couple of years in terms of supply chain and labor, not to mention the fact that the pandemic has disrupted traditional shopping patterns.

It makes sense to step back in such circumstances and make sure one is thinking strategically, not just tactically, about roll-out plans.  I suspect that the vast majority of these stores will open … not just because of Amazon's commitment to bricks-and-mortar retailing, but also because many of them will serve as de facto dark stores that just happen to let shopper in.  Their strategic advantage is as distribution centers closer to customers, not just as supermarkets, which is why Amazon probably isn't backing down.