Amazon’s free grocery deliveries could be ruinous for the supermarkets

Only a fraction of the country uses the website to order food despite its existing tie-ups with Morrisons and Booths, the so-called Waitrose of the North. This has the potential to unleash a marketing and promotions war before Christmas, Brereton says, as both Waitrose and Marks & Spencer are poised to sell more online from autumn. 

It will also face logistical hurdles, such as bespoke vans and depots to store chilled food. It does, however, already have 14 purpose built deports to support its food arm in the UK, which lays bare the extent of its ambitions.

In contrast, online grocer Ocado has only a handful of warehouses, albeit they are powered by robots, which are quicker than the human pickers that Amazon will use. 

Bosses at Morrisons’ headquarters in Bradford will not be pleased to hear of Amazon’s plan either. Only in May it said it was expanding the same-day grocery delivery service it runs with Amazon as online orders went through the roof. 

Supermarket chains would be foolish to burn through cash to be on par with Amazon. They should use their differences to their advantage and focus on what sets them apart such as their sustainability credentials and environmental initiatives, which shoppers increasingly take into account before they part with cash. 

Their other trump card is loyalty, historically stronger within the supermarket’ ranks – but fidelity could be fickle as the pandemic batters the consumer economy. 

Grocers, on guard!

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