Amazon Expands Online Grocery Strategy in UK, Doubles Down on Delivery

Amazon plans to expand online grocery delivery in the UK, doubling down on online delivery while scaling back physical Fresh stores. The company will offer faster deliveries and a broader selection of groceries, with more than 80% of UK Prime members gaining access to at least one grocery partner by early 2026. Amazon will also roll out Same-Day Delivery for fresh groceries in 2026 and convert five Fresh locations into Whole Foods Market stores, expanding its organic and premium grocery footprint.

Amazon (AMZN) is reorienting its retail strategy in the UK by closing its Amazon Fresh stores and doubling down on its online grocery delivery service. The company plans to expand its online grocery offerings and convert five Amazon Fresh locations into Whole Foods Market stores, aiming to enhance its organic and premium grocery footprint.

Amazon Fresh stores in the UK will be closed, with five locations transitioning into Whole Foods Market outlets. This strategic shift follows the company's evaluation of the business and substantial growth opportunities in online delivery. The company has seen strong demand for household essentials and groceries from its Amazon.co.uk store, Amazon Fresh online, Whole Foods Market, and its online delivery partnerships with Morrisons, Co-op, Iceland, and Gopuff Amazon (AMZN) Shifts Strategy in UK: Closing Fresh Stores and Boosting Online Offerings^[1].

Amazon is committed to doubling its UK Prime members by 2026, with more than 80% of these members gaining access to at least one grocery partner by early 2026. The company plans to introduce perishable groceries alongside everyday essentials and other products on Amazon.co.uk with same-day delivery in 2026. This expansion aims to meet the growing demand for fresh and perishable items.

John Boumphrey, country manager of Amazon UK, stated, "We're deeply invested in the UK's economic growth and creating opportunities for both customers and employees. We'll be working hard to support any potentially impacted teams throughout these planned changes and are deeply grateful for their dedication. If the proposal moves forward, we’ll support our employees by offering alternative employment opportunities within Amazon wherever possible" Amazon.com To Close All Of Its Amazon Fresh UK Stores^[2].

Amazon's financial health remains robust, with consistent revenue growth and expanding margins. The company reported a revenue of $670.04 billion, with a three-year revenue growth rate of 9.3%. Its operating margin stands at 11.37%, and the net margin is 10.54%, indicating strong profitability Amazon (AMZN) Shifts Strategy in UK: Closing Fresh Stores and Boosting Online Offerings^[1].

Despite the setbacks in physical retail, Amazon is focusing on its online grocery delivery service, which has seen significant growth. The company's strategic shift in the UK retail market presents new opportunities, but investors should remain vigilant of potential risks, including insider selling activity and valuation concerns. The ongoing expansion in online grocery services and collaborations with established retailers could serve as catalysts for future growth.