Soaring demand for online food delivery during the coronavirus pandemic has forced Amazon to create a waitlist for new shoppers. It’s part of a number of changes Amazon is making to its food delivery business.
Shoppers who want to order through Whole Food or Amazon Fresh have recently found it nearly impossible to find an open delivery or pickup slot. Beginning Monday, Amazon said it’s requiring new customers that want to use those services to “sign up for an invitation” to help it handle the demand crush.
Amazon explained in a blog post that it recently boosted order capacity by 60% in recent weeks and is adding more. That is still not enough to meet demand from the millions of subscribers to Amazon’s Prime services.
Among the other changes Amazon is implementing in the coming weeks includes giving delivery customers a “virtual place in line” to shop so the company can distribute demand.
Amazon also said that it added pick-up to roughly 70 new Whole Foods locations, bringing its total to more than 150 stores. Around 480 Whole Foods stores are open in the United States. Amazon is also adjusting opening hours at some Whole Foods locations so employees can use the reduced shopping hours to fulfill online orders.
Separately, a Los Angeles-area store built for Amazon’s new grocery concept was converted to a warehouse to process online orders.
Most grocery competitors have implemented similar measures, including Walmart, Kroger, Costco and Target.
Amazon bought Whole Foods for $13.7 billion in 2017. Amazon has struggled with its grocery strategy and has failed to significantly grow its share of the $830 billion American grocery industry.
Whole Foods and Amazon together control 4% of the grocery market, according to an estimate from Cowen. Walmart, by comparison, controls an industry leading 21%.
Amazon does not break out Whole Foods’ sales, but revenue at physical stores — which also include cashier-less Amazon Go stores, Amazon Bookstores and Amazon Four-Star — fell 3% during Amazon’s most recent quarter compared with a year ago. Amazon blamed an accounting change and a shift in the calendar for the decline.