Amazon Closing UK Grocery Stores Amid Rising Online Demand

Amazon is considering shuttering its U.K. “Fresh” stores amid rising online grocery demand.

The tech giant said Tuesday (Sept. 23) that it had launched a “consultation” with employees about the proposed closure of the Fresh locations in England, after evaluating its operations and seeing “very substantial” growth opportunities in online delivery.

“UK customers are increasingly shopping for groceries and household essentials online,” Amazon wrote on its blog.

“Amazon UK’s growth in the grocery category is outpacing the rest of our UK business: hundreds of millions of everyday essentials were delivered the same or next day in the UK in 2024—an increase of nearly 20% year over year.”

To that end, the company said it is working to expand its online grocery selection while offering delivery services to new areas.

By early 2026, Amazon aims to double the number of Prime members in the U.K. with access to three or more online grocery delivery options through its partnerships with Morrisons, Iceland, Co-op and Gopuff. This expansion will allow more than 80% of U.K. Prime members to shop at least one of Amazon’s grocery partners.

In addition to the online grocery expansion, Amazon also wants to convert five Amazon Fresh locations to Whole Foods Markets.

In related news, PYMNTS Intelligence’s September Share of Wallet report, “Amazon Extends Gains While Walmart Holds Steady in Q2 Spending,” shows how entrenched Walmart’s grocery dominance has become.

As of the second quarter of this year, Walmart holds a 21% share of the American grocery market, a figure boosted by more than 4,600 locations that place 90% of the U.S. population within 10 miles of a store.

Despite spending billions of dollars on Whole Foods and Fresh, Amazon has enjoyed just a modest increase in its grocery share, reaching 2.7%, growth of less than 1 percentage point in six years.

“While Amazon’s eCommerce engine continues to disrupt other retail categories, it faces tough headwinds in grocery, where instant access, curbside pickup and impulse buying still favor Walmart’s brick-and-mortar network,” PYMNTS wrote.

Additional PYMNTS Intelligence research that 88% of U.S. grocery shoppers would rather shop in-store than online, underscoring shoppers attachment to the in-store experience, even as digital retail increases its foothold in other sectors.

“Walmart’s physical store network is pivotal in why it remains the top grocery destination. Its reach and low-cost perishables give the supercenter chain an edge,” the report added. “Even as Amazon fine-tunes urban-centric delivery and premium strategies, most shoppers reach for groceries where aisle browsing and immediate fulfillment are possible.”