Amazon.com (NASDAQ:AMZN) on Tuesday announced plans to reshape its U.K. grocery strategy by doubling down on online delivery while scaling back its physical Fresh stores.
The company said it will expand its offering of grocery and household essentials on Amazon.co.uk, offering faster deliveries and a broader selection.
By early next year, more than 80% of U.K. Prime members will gain access to at least one grocery partner, including Morrisons, Co-op, Iceland, and Gopuff, as Amazon intensifies competition in one of the world’s largest online grocery markets.
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Amazon U.K.’s everyday essentials category, which includes groceries, has grown nearly twice as fast as other categories. In the first quarter of 2025, these products accounted for almost one-third of all units sold on Amazon.co.uk. PwC expects Britons to conduct over 25% of their food spending online by 2030.
Amazon will roll out Same-Day Delivery for fresh groceries in 2026, adding perishable items such as meat, dairy, seafood, baked goods, and frozen food to millions of everyday essentials and electronics already available.
The company has already launched the service in the U.S., signaling its intent to replicate the model in the U.K.
Amazon also proposed closing its physical Fresh stores, though it pledged redeployment opportunities for affected employees.
It plans to convert five Fresh locations into Whole Foods Market stores, expanding its organic and premium grocery footprint. With this move, Amazon aims to grow Whole Foods’ U.K. presence to 12 stores by 2026.
Amazon stock has struggled this year, gaining just 0.60% year-to-date, and closed down 3% on Tuesday, the worst performer on the Dow. The company is also facing legal scrutiny from the Federal Trade Commission over claims that it made it excessively difficult for customers to cancel Prime memberships.
Earlier this year, Amazon announced plans to invest 40 billion pounds ($54.5 billion) in the U.K. from 2025 to 2027, expanding logistics, data centers, and corporate facilities.
The plan includes four new fulfillment centers, delivery stations nationwide, and two new East London headquarters buildings, creating thousands of full-time jobs, primarily outside London and the South East.
Amazon estimates the investment could contribute 38 billion pounds to U.K. GDP, building on 75 billion pounds invested over the past decade.
This includes 8 billion pounds earmarked for data centers through 2028 and expanded R&D in areas such as Prime Air drone deliveries, with Darlington slated for the U.K.’s first drone deliveries.
Price Action: AMZN stock was trading higher by 1.54% to $224.11 premarket at last check Wednesday.
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