Amazon is no stranger to the Food Institute Blog. They serve as a benchmark for e-commerce in many ways, and over the weekend, the company made two moves that will likely impact the retail world in the coming months.
To start, the company announced a dynamic pricing plan for its Amazon Prime service. For customers who pay up front for an annual subscription, prices will remain at $99 ($49 for students). However, for those who opt to be charged on a monthly basis, rates will change, reported AL.com (Jan. 19).
Monthly payments will increase from $10.99 a month to $12.99 a month for regular consumers, while students will see a bump from $5.49 to $6.49 per month. The price changes are effective Jan. 19 for new members, while existing members will have until Feb. 18 to decide upon their pricing plan.
The new pricing plans will undoubtedly affect mostly Amazon fans, but this news is likely more interesting to most: Amazon opened its checkout-free grocery store, which replaces human employees with automated systems. The Amazon Go concept uses cameras and sensors to track what shoppers remove from or put back on shelves, and automatically bills them for items removed from the store. Customers must scan an Amazon Go smartphone app to enter, reported Reuters (Jan. 22).
The new store will put more pressure on other retailers who may be struggling to keep up with technology, but perhaps Amazon is advancing too quickly in its pursuit of grocery dominance. Amazon-owned Whole Foods Market's inventory-management system may be leading to inventory shortages, according to employees. The company claims the pre-Amazon system reduces unnecessary inventory, lowers costs and frees up employees to focus on customer service. However, while employees acknowledge that less food is spoiling in storage rooms, some argue it leads to many items being out of stock, reported Business Insider (Jan. 18).
If anyone wondered how Kroger would fare now that Amazon has jumped into the grocery space, I think we can safely say that any doubts have now been put to rest. The company recently reported a $2 billion profit for its first quarter on the heels of the sale of its convenience store business, and that's just the start of it.read more
If you've gone to the grocery store lately you've surely noticed the increased importance given to products that make mealtime easier. From pre-cut fruits and vegetables to meal kits to fully-prepared dishes, the supermarket is becoming a major competitor in the foodservice sector.read more
Chris focuses on fresh, canned and frozen fruit and fresh and dried vegetables for the Food Institute Report. In addition, he assists in compiling data for various Food Institute publications throughout the year. He is a proud Rutgers University alumnus with a degree in English, and has a background in web writing for a variety of industries, including legal, foodservice and small-to-medium sized businesses. In his downtime you can find him watching New York Yankees baseball, hiking, enjoying live music and spending time with his dog Kaiden. He invites you to contact him via email at email@example.com to talk about anything food-related.
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