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Bloomberg has a piece about how, while it has been four years since the opening of the first Amazon Go checkout-free store, " the e-commerce behemoth is a long way from conquering Main Street.

"But a strategy is gradually emerging that could make Jeff Bezos & Co. a deluge of profit from the concept without opening a single store more.

"That’s because selling groceries isn’t a great business these days. Selling software, however, often is.

"The tech is pretty nifty. Shoppers fill their baskets and then, tracked by computer vision technology, simply leave without needing to check out. The cost is debited from their accounts automatically … Amazon seemed to be drawing a new line of battle with brick-and-mortar retailers. But there are still only some 30 Amazon Go locations in the U.S. and the U.K.

"Back in 2018, admittedly pre-pandemic, Bloomberg News reported that the company was considering a plan to open as many as 3,000 cashierless stores by 2021.

"Bezos and his lieutenants now seem to be gearing up for a different fight entirely: to control the operating system for the world’s shops.

"This year, Amazon has signed a flurry of deals to provide its so-called Just Walk Out technology to other stores. Last month, Starbucks Corp. opened a cafe in New York that uses the system, the same week Bloomberg News reported that Britain’s J Sainsbury Plc was deploying it at a trial store in London. Dufry AG is using it at Hudson-branded convenience stores at airports in Dallas and Chicago."

KC's View:

You can be on the throne.  Or you can be the power behind the throne.

The Bloomberg story makes the point that the economics of a checkout-free store have changed.  Dramatically.  

These stores used to cost $4 million a year to run just four years ago.  Now, they cost as little as $159,000 a year to run.

At a time when retailers are trying to deal with labor shortages and reduce friction, embracing the Amazon Go model - or one of its competitors, which are out there - makes a lot of sense.  Though I'd be very careful about access to customer data;  there have to be firewalls that protect the retailers' most important asset.