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Amazon (AMZN)’s Walk Out Stores Are Totally Impractical: Trip Chowdhry

Amazon.com (AMZN) Amazon

Amazon.com, Inc. plans to open new brick-and-mortar grocery stores next year. The new stores will use the company’s latest technology to offer shopping experience with no lines and no checkout. Talking to CNBC, Trip Chowdhry, analyst at Global Equities Research, said that he does not see Amazon’s new stores as a game changer.

On Monday, the e-commerce giant announced that it is testing out a type of grocery stores, called Amazon Go. The stores, according to the online retailer, are designed to offer a checkout-free shopping experience. The walk out stores will use “the world’s most advanced shopping technology” to allow shoppers to fill their bags and walk out without going through a checkout process.

Amazon Go

Amazon.com, Inc. said that its walk out store will offer ‘just walk out shopping experience,’ with no checkout or waiting in line. Customers will need to download and use a mobile app to enter the store, take the products they want, and walk out.

The online retail titan said that it opened a location in Seattle to test the new Just Walk Out system. At the company’s walk out store in Seattle, shoppers will simply be able to scan their smartphones at the entrance using a brand new mobile app. The technology then tracks the items they pick up or return to the shelves. These products are added to a virtual shopping cart in real time. As the shoppers leave the store, their Amazon account is charged automatically. The entire store will function with sensors, computer vision and deep learning.

“Our checkout-free shopping experience is made possible by the same types of technologies used in self-driving cars: computer vision, sensor fusion, and deep learning. Our Just Walk Out technology automatically detects when products are taken from or returned to the shelves and keeps track of them in a virtual cart. When you’re done shopping, you can just leave the store. Shortly after, we’ll charge your Amazon account and send you a receipt,” the online retailer said.

At the walk out stores, customers will be able to buy ready-to-eat breakfast, lunch, dinner, and snack options, which will be made every day by the company’s on-site chefs and favorite local kitchens and bakeries.

“Our selection of grocery essentials ranges from staples like bread and milk to artisan cheeses and locally made chocolates. You’ll find well-known brands we love, plus special finds we’re excited to introduce to customers. For a quick home-cooked dinner, pick up one of our chef-designed Amazon Meal Kits, with all the ingredients you need to make a meal for two in about 30 minutes,” according to the online retailer.

To enjoy a checkout-free shopping, shoppers will need an Amazon account, a smartphone, and the free Go app.

amazon-store

The online retailer opened Amazon Go is to its employees for testing. It plans to open the store to the public in early 2017.

Amazon Go Won’t Be Game Changer

A report from Forbes suggested that Amazon Go could drastically change food retailing as well as every segment of retail. These stores will save consumers time and hassle, while retailers will save labor costs, which are increasing day-by-day.

But Chowdhry isn’t impressed with Amazon Go.

On the CNBC’s World On the Street show, Chowdhry said that the company’s walk out technology is interesting but not practical. He believes the walk out store will not be a game changer.

Amazon.com, Inc. is betting big on physical stores. The online retailer is reportedly planning to open a physical bookstore near Boston. CEO Jeff Bezos has told shareholders that the e-commerce giant plans to open more brick-and-mortar bookstores.

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Adam Green is an experienced writer and fintech enthusiast. He he worked with LearnBonds.com since 2019 and covers a range of areas including: personal finance, savings, bonds and taxes.

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