Business development · 14 October 2016

Is Amazon about to wage war on Britain’s cornershops?

amazon_cornershops
The rumoured grocery stores have been billed as “Project Camo” by Amazon workers

US ecommerce giant Amazon is about to take its first step into bricks and mortar grocery shopping, according to industry rumours.

The planned venture – known in Amazon circles as “Project Camo”, according to the Wall Street Journal – is expected to launch soon in the US, but following the move into several other markets from Amazon, it is possible the company could introduce the convenience stores in the UK too.

The US newspaper reported on comments relayed by Amazon workers that bosses intend to use the Lidl and Aldi business models – simple product offerings at discounted prices – for the stores.

Amazon entered the same-day delivery grocery space in the UK in June this year with AmazonFresh. As well as offering customers products from Morrison’s supermarket, the service gave small suppliers the opportunity to sell their produce, including the likes of Dragons’ Den winner Bad Brownie and family-run fruit company Chegworth Farm.

Commenting on the launch of the service, vice president of AmazonFresh, Ajay Kavan, reported a welcome reception from UK shoppers.

“The initial response we have received from customers in the capital has been very positive with many calling out low prices, vast selection and fast delivery as their reasons to shop on AmazonFresh,” he said in a statement.

Although the so-called “Project Camo” stores may provide further opportunities for small grocery suppliers to sell products in, independent food retailers and cornershops will be less welcoming of the competition.

Amazon has previously come under fire from small business owners in the US and Europe for creating unrealistic levels of competition, following the launch of its same-day delivery Amazon Prime Now service.

After launching in Paris in June 2016, the city’s mayor, Anne Hidalgo, called on Amazon to “guarantee that its approach fully respects local businesses and takes into account the absolute necessity of preserving their diversity”.

“This operation is likely to seriously destabilise the balance of Parisian businesses,” she concluded.

The nation’s cornershops and grocery stores may find some reassurances in research that suggested people would rather buy from local, independent businesses.

Some 80 per cent of respondents to one survey claimed that they felt happier buying from a small firm that feels familiar and trustworthy.

Small retail owners have been advised to take advantage of the size of their business.

Fiona Mills, director at Avery WePrint, said: “If you’re proudly independent or a passionate small business that really cares, it’s worth communicating this in everything you do – from your business cards to branding and marketing materials, your packaging, presentation and your customer service.”

Such advice may be essential to independent grocery store owners if Amazon decides to launch grocery stores in the UK.

Does Amazon Prime Now pose a threat to small business owners?

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ABOUT THE EXPERT

Simon Caldwell is deputy editor at Business Advice. He has a BA in politics and communications from the University of Liverpool, and has previously worked as a content editor in local government and the ecommerce industry.

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