Amazon.com Inc. is planning a second drive-up grocery store in the Bay Area, showing that the e-tailer wants to roll out the new concept on a broader scale as it seeks a bigger share of the enormous grocery market.
I first reported last July on Amazon’s plans to build a 11,600-square-foot facility in Sunnyvale where customers would pick up grocery items already ordered online. The project was a first for Amazon and it wasn’t clear if the store was a one-off or a sign of something larger.
Now the same architects are working on an identical concept in San Carlos, at a site at 380 Industrial Road.
Notably, public records also directly connect Amazon to the site where the project is planned, providing the first direct proof that it is, in fact, Amazon that is behind the effort.
The initiative comes as Amazon grabs more and more market share in the online grocery business through home delivery. A new study, to be published this week by grocery industry consultancy Brick Meets Click, shows Amazon capturing about a third of all grocery spending in markets where it competes. Amazon shoppers placed 48 percent of all grocery trips in those markets at the end of 2015, up from 39 percent at the end of 2013.
Amazon launched its Amazon Fresh grocery delivery service in San Francisco in 2013, and has been steadily expanding it.
Bill Bishop, chief architect at Brick Meets Click, says the expansion into what’s called a “click and collect” model could boost Amazon’s market share further by furthering the company’s obsession with getting products to customers any way they can.
“They understand that they’re not going to have a single platform that builds this thing out,” he said. “They are going to penetrate half a dozens or more ways. They’re going to sell stuff every way they can.”
In San Carlos, architect Ware Malcomb describes the project in a letter to the city. The operation, it says, will occupy the existing 14,760 square foot building, which will be stocked with groceries and “related household items.”
It works like this, according to the letter:
“Customers will purchase their products online and later pick- up their purchased products at the site. When placing a purchase order, customers will schedule a specific 15 minute to 2 hour pick-up window. Peak timeslots will sell out, which will help manage traffic flow within the customer loading area adjacent to the building.
When picking up purchased items, customers either can drive into a designated loading area with 9 parking stalls where the purchased items will be delivered to their cars (customers will be directed to turn off their engines once they park to wait for their delivery), or they can arrive on foot or bicycle and pick-up their items in a reception area. The average customer wait time on-site is expected to be 5 minutes.”
The project doesn’t list Amazon as the applicant. But a loan document filed by the property owner in April discloses that an entity called Golden State FC signed a lease for the property on October 22. Golden State FC’s address is Amazon’s headquarters in Seattle and is listed as “c/o Amazon.com Inc.” Amazon uses the entity in its industrial real estate dealings.
Still, the proposed San Carlos store — next to a new Orchard Supply Hardware — isn’t a done deal. It needs a conditional use permit from the city, and officials aren’t sold on the idea because of the potential for frequent truck deliveries near a residential neighborhood, said Al Savay, San Carlos’s community development director.
“One thing we’re concerned about is it’s right next to a residential neighborhood,” Savay said. “If it’s a grocery store, it would require deliveries. We’ve had issues with regard to where the delivery point would be, what would the noise be and things like that.”
Meanwhile, the Sunnyvale store is also in limbo while the city completes an extensive environmental review. The city opted for a thorough environmental impact report after a mysterious (but likely union-backed) opposition effort appealed the city’s original approval.
Amazon declined to comment, and Ware Malcomb didn’t respond to requests for comment.
Source: San Francisco Times