Amazon has moved a step closer to launching a grocery service in the UK, taking over the lease on a warehouse previously used by Tesco.
The US online retailer is to use the site in Weybridge, Surrey, which used to be a Tesco distribution centre and is ideally positioned just inside the M25 to deliver fresh food to London shoppers.
Amazon’s grocery service, Amazon Fresh, is already available in Seattle, California and New York and the company is now close to launching in the UK. The online retailer has presented its grocery plans to major food manufacturers in Britain and could launch the service as early as next month.
The launch would put further pressure on Britain’s beleaguered supermarkets, which have suffered a slump in sales and profits, and are battling for customers with price cuts.
Amazon Fresh has the potential to revolutionise grocery shopping in Britain. In California, shoppers use it to buy food from local shops and restaurants, while a wireless device called Amazon Dash monitors when users run out of household essentials and orders replacements.
Amazon already sells household essentials such as tea, toothpaste and washing-up liquid, but Amazon Fresh includes fruit, vegetables, bread and meat.
The company confirmed it was opening a delivery station in Weybridge, but declined to comment whether this would form part of Amazon Fresh in the UK, calling the potential launch of a grocery service “rumour and speculation”.
Amazon said it will employ 20 people directly at the site in Brooklands business park, with four independent delivery companies also hiring 140 drivers to work from the station.
This tallies with rumours that Amazon plans to use third-party drivers and vans fitted with cool boxes to deliver groceries.
The warehouse covers 300,000 sq ft, which is a similar size to other facilities used for online grocery deliveries. It has been empty since Tesco closed its distribution centre in 2013 with the loss of hundreds of jobs.
A company called Clegg Food Projects is understood to be revamping the warehouse for Amazon, although the site already includes chiller cabinets. According to its website, Clegg Food specialises in “providing practical solutions for major food and drink operations”.
The website adds: “Whether it’s a multimillion-pound new food facility, or if you’re looking to improve your existing manufacturing processes, our team of specialists can help come up with the best solutions for your project.”
Amazon has also agreed to lease a warehouse in Bardon, Leicestershire. A spokesman for the company said this would also be a “delivery and sortation station”, although the building is thought to have planning permission to store food. It will replace a smaller site at nearby Castle Donington, which will close in the autumn.
Amazon has stepped up its investment in UK delivery services in recent months. As well as launching Sunday deliveries, Amazon offers one-hour delivery on more than 20,000 products in London and Birmingham.
The Weybridge site will be Amazon’s 15th delivery station in the UK, while the company also has eight “fulfilment centres” across the country where orders are packaged for delivery. Amazon is opening a ninth fulfilment centre in Dunstable, Bedfordshire, which could also be used for Amazon Fresh.
The launch of Amazon Fresh would pit Amazon directly against Ocado, which is the biggest online-only grocery retailer in Britain but has struggled to make a profit. Ocado shares have fallen by 15% in the past month as speculation that Amazon could start delivering groceries has increased.
This article was written by Graham Ruddick, for theguardian.com on Monday 10th August 2015 18.11 Europe/Londonguardian.co.uk © Guardian News and Media Limited 2010