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Will Amazon Shutter Supermarkets?

NEW YORK ( TheStreet) -- I live less than a block from a Safeway (SWY) grocery store and a stone's throw from three Whole Foods Market (WFM - Get Report) locations.

However, over the weekend, I used (AMZN - Get Report) to conduct the bulk of our weekly grocery shopping.

As I explained earlier this month, after a lengthy trial in the Seattle area Amazon has made "Fresh" grocery service available throughout large swaths of the Los Angeles area. That includes my zip code -- and others -- in Santa Monica.

"Fresh" works as part of your "Prime" membership. After a free three-month trial, you agree to pay $299 a year for Prime -- as opposed to the current rate of $79 -- and you receive free delivery on all Amazon Fresh orders greater than $35.

As I expected, Amazon Fresh delivers the same quality experience we have come to expect from the traditional Amazon ordering process. Efficient. Speedy. Well-executed. And it absolutely competes on price.

I probably don't look at price tags as much as I should, but it appeared to me that everything we ordered was priced the same as, or less than, what we pay at Safeway. And almost always less -- no surprise -- than what we pay at Whole Foods. I don't routinely buy groceries at Target (TGT - Get Report) and never go to Walmart (WMT - Get Report), but I presume Amazon is in their ballpark.

My wife commented that what we got a lot more for the $55 or so we paid Amazon than she did on a quick weekend trip to Safeway where she dropped $47. Plus, you also get a bunch of free bottled water, which leads to my only gripe with Amazon Fresh.

I chose "Doorstep Delivery," which means the driver leaves your order at your door. To ensure everything arrives and stays fresh, Amazon loads collapsable styrofoam containers with frozen bottles of water (safe to drink) and, in one instance, a bit of dry ice. That makes for a lengthy unloading process. Plus, I have to store two of the bags (pictured above), bulked up with the styrofoam, in my small apartment until the next delivery.

I assume -- and hope -- if I opt for "Attended Delivery," meaning the driver knocks on my door and I must be present to accept the order, there will be less packing material. Seems to me milk, produce and the like can survive just fine in insulated bags using this method. But I don't know how long the distribution process takes, so we'll see.
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AMZN $672.21 -0.16%
TGT $72.55 -1.20%
SWY $35.10 -0.11%
WMT $59.06 -1.40%
WFM $29.28 -0.44%


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