chrisdorney/Depositphotos.com
September 26, 2025
Why did Amazon Close Amazon Fresh in the UK?
Amazon is closing all of its Amazon Fresh grocery stores in the U.K., but also placing bigger bets on Whole Foods — particularly around online grocery delivery in the region.
In a blog entry, Amazon said it had “made the difficult decision” after a “thorough evaluation of business operations and the very substantial growth opportunities in online delivery.”
All 19 Amazon Fresh stores in the U.K. are closing, although five will be converted to a Whole Foods location. With the five stores and openings planned for Chelsea and Greater London, Whole Foods will have 12 locations in the U.K. by the close of 2026.
Amazon’s blog entry touted Whole Foods’ differentials, including natural and organic foods and commitment to sustainable practices. Amazon said, “Customers tell us they love shopping the Whole Foods Market physical store experience.”
Amazon Fresh, which first arrived in the U.K. only in 2021, offer less-expensive prices and more mass-market items. The concept also features Amazon’s cashierless “Just Walk Out” technology.
However, Amazon’s blog entry particularly called out plans to expand online grocery services. Amazon said, “In response to strong customer demand, we are working hard to add more grocery selection online and expand our delivery services to new areas.”
Amazon’s blog entry pointed to a report from PwC’s Strategy& indicating that by 2030, Britons are expected to conduct over 25% of their food spending online.
Amazon noted that Amazon U.K.’s growth in the grocery category, boosted by same-day and next-day delivery, is outpacing the rest of its U.K. business, increasing nearly 20% year-over-year in 2024. Everyday essentials, which includes groceries and household items, grew nearly twice as fast as all other categories in the U.K., and now represents nearly one out of every three units sold on Amazon.co.uk.
Amazon Seems Zeroed in on UK Expansion via Partnerships, e-Comm
To build on the momentum, Amazon expects, by early 2026, to more than double the number of Amazon U.K. Prime members who have access to three or more online grocery delivery options through partners Morrisons, Iceland, Co-op, and Gopuff. With the expansion, more than 80% of U.K. Prime members will be able to shop at least one of its grocery partners. In 2026, Amazon will also be introducing perishable groceries on Amazon.co.uk.
The moves are seen as similar to those in the U.S., where Amazon has closed some Amazon Fresh stores and slowed the format’s expansion while recently announcing plans to rapidly expand the same-day delivery of perishables.
Sucharita Kodali, an analyst at Forrester, told BBC that Amazon “hasn’t quite figured out a successful” plan for grocery stores while noting the grocery channel remains “very competitive,” including in the U.K.
She said, “It’s unlikely that Amazon Fresh has created a differentiated offering and it may not even have ideal locations, so it’s probably not been set up well for success from the start.”
Discussion Questions
Does the closure of Amazon Fresh’s stores in the U.K. say more about a lack of success of the Amazon Fresh concept, or Amazon’s growing ambitions around online grocery delivery?
Where do you believe the optimal opportunity is for Amazon in grocery?
Poll
Loading …BrainTrust
Mohamed Amer, PhD
CEO & Strategic Board Advisor, Strategy Doctor
Scott Benedict
Founder & CEO, Benedict Enterprises LLC
Bob Amster
Principal, Retail Technology Group
Recent Discussions
More Discussions
Has Maverik Made a Mistake on its Kum & Go Rebrand?
Maverik has completed its rebranding of Kum & Go, folding the stores into its own banner…Is Guilt Messaging the Path To Influencing Consumer Behavior?
A university study has found that telling consumers their returned items will be “kept out of…How Great of an Advantage Do Low-Price Leaders Like Walmart and Aldi Have?
Low-price leaders like Aldi and Walmart, among others, are vying for an increasingly savvy consumer. How…
The UK grocery market one of the most competitive and consolidated in the world. Operators are sophisticated and many, like Tesco and Sainsbury’s, have extensive networks of smaller convenience stores that perform well thanks to their optimal locations.
The question is: what did Amazon add? The answer is, not much. Its range was unremarkable, and for treats and indulgences it lagged well behind players like M&S and Waitrose. Pricing was reasonable, but nowhere near as compelling as Aldi. So, they leaned into technology. The problem there is that walk out technology is not a differentiator: most consumers do not care about it.
Ultimately, the failure stems from Amazon’s inability to disrupt an established market through customer-centric innovation – a weakness that also pervades its physical grocery operations in the US. That said, Amazon is now leaning more heavily into online grocery, a channel where it can differentiate and leverage a genuine strategic advantage.
And I’m not sure Whole Foods will find mainstream success in the UK either. Every supermarket has organic; every supermarket has premium ranges that are high quality. And in the upscale space, the UK has M&S and Waitrose – both of which are vastly superior to Whole Foods. In the US, there is some white space in premium. There isn’t in the UK.
The obvious answer is that it wan’t making money, and they didn’t expect it to (Translation: it was a normal business decision…even Amazon makes those, apparently) It’s possible, of course, that wasn’t the thought process, but I’m not sure we’ll ever know. As for Amazon and grocery, it seems to be something akin to a hobby…for those of us who think online will never be as big in grocery as other goods, it may never be more than that.
The UK’s geography is more compact than the U.S., which allows Amazon to lean on its logistics prowess to serve shoppers faster with same-day delivery. Grocery partnerships and the UK’s e-commerce maturity make e-grocery more tantalizing to Amazon than physical stores.
The UK decision to shutter all Amazon Fresh stores says more about the limits of that physical-store format in that market than a loss of belief in grocery overall. Amazon explicitly cited “growth opportunities in online delivery” as the rationale for the pullback. The Fresh concept—particularly the “just walk out” technology—never quite achieved enough differentiation or consistent margin in a fiercely competitive and low-margin grocery landscape. Standalone high-tech stores can be expensive to operate, and Amazon likely concluded that resources would be better deployed in bolstering its online grocery engine and partner network.
The optimal path forward for Amazon in grocery lies in leveraging what it does best: scale, logistics, data, and digital convenience. Its strength is not in owning every physical store, but in integrating seamless online shopping, rapid delivery and fulfillment, and partnerships with regional grocers to extend reach without full retail overhead. In the U.K., it already plans to double the number of grocery delivery options via tie-ins with Morrisons, Co-op, Gopuff, Iceland, etc.
In short: the closure isn’t a retreat from grocery ambition—it’s a reallocation. Amazon appears to be recalibrating to a physical footprint that supports brand and consumer trust (e.g. via Whole Foods) while placing its bets on scaling the online model.
Amazon’s strength lies in providing the infrastructure for other retailers, rather than being the best retailer itself. The immediate lesson from the closure is that walk-out technology isn’t a differentiator that consumers care about. More broadly, convenience innovations do not automatically create competitive moats. In grocery, where margins are razor-thin, operational fundamentals matter more than technological bells and whistles. Physical grocery requires local market intelligence, supply chain intimacy, and cultural adaptation that pure-play digital companies struggle to develop organically.
Amazon’s pursuit of a partnership strategy (with Morrisons, Co-op, Iceland, and Gopuff) actually serves as an infrastructure layer, capturing transactional data without the operational heavy lifting. As to the Whole Foods expansion plan, it is problematic given the lack of differentiation the concept brings to the premium UK market.
Because Amazon Fresh was ill-conceived from the start?
I’ve had students use Amazon Fresh for marketing projects. And every time, they end up entirely confused about what Amazon thinks the idea is all about. So I’m not sure if it’s a name searching for a valuable business or merely the idea of “grocery and Amazon” searching to find a meaningful value. Either way, I’m mostly surprised that they keep trying. Seems to have become one of those vague ideas which just refuses to die.
I think the UK test & learn was based on tech usage… The UK has a higher rate of adoption for contactless and mobile payment technologies. Mobile payments are significantly more used in the UK than in US
Tying the Amazon food & retail & payment together, wrapped in convenience message.
I can certainly see city shoppers liking delivery, vs yet another store that is similar in products. (I remember being a university student in London carrying groceries on the tube).
As UK is smaller geography than USA, it might be more viable for Amazon to be in delivery. And retail to be more purposeful (esp considering real estate costs)
To be honest, Amazon Fresh has very limited appeal in the UK. The concept failed to deliver significant differentiation, neither in range nor technology, lagging behind established players on product and convenience. Ultimately, tight margins and high operational costs made large-scale disruption impractical, especially when every major grocer already excelled at convenience and premium offerings. Amazon’s pivot to online delivery and local partnerships is a strategic refocus on its strengths in logistics and data, rather than retail store innovation.