Amazon is preparing for another assault on Britain’s fiercely competitive grocery sector, this time by converting its abandoned Fresh convenience stores into outlets for Whole Foods Market, the organic chain it acquired for $13.7 billion in 2017.
The move comes barely six months after the US tech giant closed 19 of its vaunted grab-and-go fresh stores across the country. Launched in 2021 with bold language across hundreds of locations and a revolution in convenience shopping, the format simply didn’t resonate with British consumers. The experiment ended in September last year.
Now Amazon hopes Whole Foods can succeed where Fresh couldn’t. The brand, which currently operates seven shops in London, plans to open five more locations by the end of June. Four of these will occupy former Fresh premises, including a new store in Angel, Islington, which opened this week, as well as planned sites in Wood Wharf in Canary Wharf, Gracechurch Street in the City, Liverpool Street and Notting Hill Gate. Another opening is planned for St. James’s.
Jade Hoai, buying director at Whole Foods Market UK, said the expansion in London reflected confidence in the brand’s offering, particularly in areas where customers shop frequently and look for quality food in their everyday lives.
But the turnaround inevitably raises the question of whether Amazon is simply replacing one struggling format with another. Whole Foods has had a tough time on this side of the Atlantic since entering the UK market in 2004. Sales at its UK branch fell seven per cent to £86.4m in the year to December 2024, while pre-tax losses reached £20m. Cumulative losses now amount to over £200 million. The company closed two underperforming stores and its Dartford distribution center in early 2024, reducing its average headcount from 798 to 608.
High operating costs and strong competition from incumbents have continually undermined the chain’s efforts, and its premium prices have proven a difficult sell in a market dominated by discounters Aldi and Lidl on the one hand and established giants such as Tesco and Sainsbury’s on the other.
The picture is significantly different in the United States, where Whole Foods has experienced steady growth under Amazon’s leadership. The American company has expanded its market share by aggressively cutting prices and opening smaller stores, successfully ditching the “Whole Paycheque” nickname, a long-standing joke that a single bag of groceries there could eat up an entire salary.
Whether this formula can be applied to the UK remains to be seen. Hoai pointed to what she said is a significant shift in consumer behavior, with a growing demand for quality, transparency and a more thoughtful shopping experience.
The new Angel store spans 3,600 square feet and features a hot food counter, self-service coffee and an Amazon kiosk. Delivery via Deliveroo is expected to take place shortly.
For Amazon, it’s not just about groceries. The company has long viewed physical retail as a way to integrate deeper into consumers’ daily lives and drive subscriptions to its Prime service. But its track record in UK bricks-and-mortar retail gives little reason for confidence, and the decision to make further investment in a brand that has suffered more than £200m in losses will test even a company as deep-pocketed as Amazon.
