Tesco and Sainsbury’s go head-to-head over Amazon Fresh stores

The supermarket giants are both eyeing up deals to agree leases on some of the 14 former Amazon Fresh stores around the UK, which will go back on the market after the US tech giant made the decision to close its physical store estate at the end of September.

There are currently 19 Amazon Fresh stores in the UK, but five stores have been earmarked to be rebranded as Whole Foods Market stores by the tech giant – in Kensington, Camden and Chelsea.

Retail Week understands that, while Amazon made the decision to end its Fresh store estate in late September, many of the stores will remain open and trading under the fascia until at least December.

The remaining 14 former Fresh stores not being kept by Amazon are all located within Greater London and both Tesco and Sainsbury’s are both in negotiations in a bid to turn them into Express or Local c-store formats respectively.

Tesco currently operates more than 2,000 Express stores across the UK, while competitor Sainsbury’s has around 800 Local c-store formats across the UK.

A spokeswoman for Sainsbury’s said: “We regularly review all site locations that could be of new interest for our new store pipeline”.

Tesco refused the offer to comment.

As part of its decision to close its Fresh store estate, Amazon is planning an overhaul of its UK grocery operations, which will see it focus on its online business which it insists is still “fully committed” to the UK.

The retailer plans to double the number of Prime subscription members, who will have access to delivery from at least three of the retailer’s grocery partners: Morrisons, Co-op, Iceland and rapid delivery business GoPuff. Amazon also has plans to introduce fresh groceries to its own grocery delivery ecommerce site from next year.

The 250 staff who worked in its Fresh stores have been placed into consultation, and Amazon said it would offer affected workers new roles in other parts of the business.

Amazon country manager for the UK and Ireland John Boumphrey said: “Since 2008, we’ve worked hard to innovate to help our customers save time and money when shopping for groceries and household essentials.

“We continue to invent and invest to bring more choice and convenience to UK customers, enabling them to shop for a wide range of everyday essentials and groceries with low prices and fast delivery through Amazon.co.uk, Amazon Fresh, and Whole Foods Market stores, alongside our third-party grocery partners including Morrisons, Co-op, Iceland, and Gopuff.”