Amazon pivots to sell cashierless technology to third-party operators

Amazon has closed more of its cashierless convenience stores, as it takes a sideways step to act as a vendor for the technology to third-party store operators. 

An in-depth feature by CNBC on Saturday documented the emergence of Amazon’s Just Walk Out technology which was the catalyst for the Amazon Go convenience store.

Go represented an unlikely venture, years after Amazon founder Jeff Bezos dismissed the possibility of the tech multinational launching physical stores. He said the company had no interest in doing something that everyone else had been doing for so long but “we want to do something that’s uniquely Amazon.”

He continued if such a development required the need to open brick-and-mortar shops, they would pursue it. 

In 2018, Just Walk Out appeared to be the innovative, next-generation concept that Amazon was ready to proliferate. The concept means an array of cameras (particularly on the ceiling), shelf sensors, and gated entry points negate the need for a checkout line or cashier. 

In theory, it is an excellent prospect, but the reality is a lot more complicated.

 

Amazon insists it is committed to the concept

Amazon opened Go stores and also brought the cashierless system to its Fresh supermarkets and two Whole Foods stores. Then in 2020, it expanded Just Walk Out in a licensing agreement with third-party operators including airports, stadiums, and hospitals.

Then came the slump. 

In line with moves to cut costs and react to market pressures, Amazon said it would remove Just Walk Out from its Fresh and Whole Foods locations. Last week, it closed three Go stores in New York, leaving just 17 across all of the U.S. 

In a statement given to The Infomation, Amazon intimated the reduced presence was driven by economics. 

“In this case, while these three stores were performing well, we couldn’t make the economics work with the lease cost, so we’ve decided not to renew and have closed these locations,” a spokesperson said. 

Amazon will now seek to build up Just Walk Out to third-party users. The company has insisted it is committed to the concept and the technology, just not in stores of its own, and not in the present climate. 

The problems of operating such a system reflect the sector-wide difficulty of automating checkout due to the vast costs incurred.

In the absence of Just Walk Out, Amazon’s own stores will look toward Dash Carts. That system operates with enabled carts tracking and tallying what shoppers have collected as they load up bags, without the need for a checkout. 

Image credit: Via Ideogram

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