Despite pumping the brakes on some growth plans and recently saying it would lay off more than 18,000 people, Amazon is still looking to expand its empire. The company intends to “go big” on its brick-and-mortar grocery store business, CEO Andy Jassy told the Financial Times.
Amazon bought Whole Foods in 2017 for $13.7 billion, but the company is far from dominating the grocery market like it has so many other sectors. The company’s physical store division accounts for 3.4 percent of overall business and has grown only around 10 percent since the Whole Foods acquisition.
“We’re just still in the early stages,” Jassy told the Financial Times. “We’re hopeful that in 2023, we have a format that we want to go big on, on the physical side. We have a history of doing a lot of experimentation and doing it quickly. And then, when we find something that we like, doubling down on it, which is what we intend to do.”
Many of the layoffs Amazon recently announced were in its grocery division. It has closed several of its Fresh supermarkets and put plans to open new ones on hold as it tries to find a format and formula that works. Jassy noted that many Fresh locations opened in the midst of the COVID-19 pandemic and as such Amazon hasn’t “had a lot of normalcy.”
The physical retail business has struggled on other fronts. Almost a year ago, Amazon said it was closing all of its bookstores, 4-star shops and pop-up locations across the US and UK. The aim at the time was to focus more on the grocery side of things as well as physical clothing stores. However, Amazon took a $720 million hit last quarter due to slowing down its grocery expansion plans.