Amazon Changes Course on Cashierless Technology After Committing to Quit US Grocery Stores

Amazon will use cashierless technology after the company said it is rolling out its Just Walk Out program at most of its US Fresh and Whole Foods stores. The new boundary-pushing retail approach that debuted in 2018 allows shoppers to skip the lines to check out. However, in April 2023, as part of an effort to reduce costs Amazon announced that it will not open any new stores and will close several of its Amazon Go locations.

Rather than trying to continue with Just Walk Out, which requires a lot of infrastructure, these stores will start using Dash Carts. These carts will track what goes into consumers’ wallets and will pay for a more efficient checkout process. While Amazon will be transitioning its use of Dash Carts to many grocery and retail chains, the company will continue to use Just Walk Out technology in its grab-and-go locations and its new stores in the UK.

It comes at a time when Amazon is revising its retail strategy. Although the Just Walk Out program has been praised for changing the nature of grocery shopping, it has proved difficult to measure. According to Jordan Berke, founder of the retail consultancy Kusasa, automated purchasing is an expensive and complex infrastructure that is difficult for retailers to cover their necessary budgets. For example, Walmart said it estimates that updating such a system would cost between $10 million and $15 million for a 40,000-square-foot store.

For example, opening thousands of Go stores was part of the original idea. However, the reality turned out to be more complicated. Today, the technology is licensed by Amazon to third-party sellers and more than 200 stores use the system.

Going forward, the store will focus on continuing to refine the Just Walk Out solution for third-party customers in small and medium retail formats where the return on investment is close to fair value. Playing for a long time with Amazon is similar to what happened with Amazon Web Services: building trust and bringing value to the selling partner will be the kicker. It will be difficult and expensive going forward before cashierless technology finally gains widespread acceptance.