Marcia Minton’s Post

So you may have heard that Amazon-owned WHOLE FOODS IS LAUNCHING A NEW, SMALLER FORMAT FOR URBAN SETTINGS, to be called Whole Foods Daily Shop. Ranging from 7K to 14K sq ft, roughly similar to an urban CVS or Walgreens (versus the 40K sq ft average for a traditional Whole Foods), it will feature fresh produce/perishables, prepared foods, prepacked meals, weekly essentials, alcohol and a cafe - but no full-service meat counters or lunch buffets. Meant to cater to harried urbanites, it will be sited in locations convenient to early-morning or after-work commutes. Initially it will not offer pickup or delivery, though that may change. For those who dream of the “15-minute city”, this sounds like really exciting news, and for Whole Foods, it makes sense as a way of capturing incremental demand in submarkets between larger stores. Understand, however, that Daily Shop will first appear in New York City, with “plans to explore wider U.S. expansion”, presumably starting with other tightly-tightly-packed neighborhoods in larger metros like Boston, Philadelphia, Washington, D.C., Chicago and San Francisco - in other words, settings that already have these kinds of upmarket conveniences and amenities. There’s Westside Market, Garden of Eden and Union Market in New York City; Di Bruno Bros. and GIANT Heirloom Market in Philadelphia; Foxtrot Market in Chicago and Washington, D.C; Bi-Rite Market and Luke’s Local in San Francisco – frankly, in most of these cities, Whole Foods is a bit late to the game at this point. More importantly, Amazon’s efforts thus far with in-store grocery have been somewhat underwhelming. Their flat and uninspired Amazon Go concept, also designed for this purpose, leaves me cold – and evidently, I’m not the only one, with eight of its 28 units shuttered last year. Don’t get me wrong – Amazon is brilliant in so many ways, and I really want this new banner to succeed, as it would give us retail consultants another option in a critical category for our urban clients. But I’m not counting my chickens yet.   #retailcontrarian #retail #retailleasing #retailrealestate #retailproperty #retailtrends #retaildevelopment #retailmarket #retailbroker #retailspace #retailindustry #retailers #downtown #mainstreet #mainstreets #citycenter #citycentre #highstreet #urbanretail #icsc #commercialrealestate #ida #iedc #uli #icma #planning #marketanalysis #siteselection #futureofretail #urbandevelopment #jll #citymanager #cnu #businessimprovementdistrict #bid #bia #retailbrew #storefront #downtownrevitalization #nyt #wsj #urbanregeneration #planetizen #economicdevelopment #storefronts #atcm #ecommerce #shopping #wholefoods #wholefoodsmarket #amazon #amazonfresh #wholefoodsdailyshop #grocery #grocerystore #grocerystores #supermarket #supermarkets #foodmarket #foodmarkets #urbanconveniencestore #15minutecity #walkableneighborhoods #walkable #progressivegrocer #supermarketnews #liveworkplay #mixeduse #mixedusedevelopment #mixeduseneighborhood #foxtrot #grocer

The next locations of the Amazon-owned grocery store Whole Foods will be smaller and have more streamlined offerings in an attempt to capture business from urban shoppers looking to get in and out of the store quickly. Called Whole Foods Daily Shop, the stores will measure just 7K SF to 14K SF and won't feature self-serve buffets or meat counters. Shoppers will find a slimmer assortment of products, ranging from fresh produce and frozen food to prepackaged meals and Whole Foods’ 365 branded products. The first location of the new store format is planned for the Upper East Side in Manhattan by this fall. The introduction of home delivery has changed customers’ mentality,people want things fast. Whole Foods has signed five leases in New York City for the concept and plans to explore a wider U.S. expansion. All the new stores will have cashiers, self-checkout stations and palm-recognition payment service Amazon One. #cre #commercialrealestate #Commercialrealestateadviser #groceryretail

The next locations of the Amazon-owned grocery store Whole Foods will be smaller and have more streamlined offerings in an attempt to capture business from urban shoppers looking to get in and out of the store quickly. Called Whole Foods Daily Shop, the stores will measure just 7K SF to 14K SF and won't feature self-serve buffets or meat counters. Shoppers will find a slimmer assortment of products, ranging from fresh produce and frozen food to prepackaged meals and Whole Foods’ 365 branded products. The first location of the new store format is planned for the Upper East Side in Manhattan by this fall. The introduction of home delivery has changed customers’ mentality,people want things fast. Whole Foods has signed five leases in New York City for the concept and plans to explore a wider U.S. expansion. All the new stores will have cashiers, self-checkout stations and palm-recognition payment service Amazon One. #cre #commercialrealestate #Commercialrealestateadviser #groceryretail

Retail Today / Retail Renaissance: Amazon has struggled with Brick&Mortar Retail, but just announced Whole Foods new small format convenience store! #amazon #wholefoods Whole Foods Daily Shop will open their first store in the Upper East Side of Manhattan, with plans for 20 other locations in NYC. The concept will still center around organic and natural food. Whole Foods now has 530 stores, however that number could expand very quickly. I personally see huge potential here, as long as Amazon lets the products reign not technology. Hopefully they have learned a great lesson with Amazon Fresh, “customers shop for products, let technology support the enterprise”. #product #technology #amazonfresh Why smaller stores? Go where the customer lives, it’s pretty simple, convenience. What are the benefits for the retailer? They expand their reach, its cost effective, lower rents, less inventory and reduce labor. #conveniencestores #rent #labor Whole Foods will be joining many other retailers moving into small store formats, #bestbuy, #macys, #nordstrom, #kohls, #ikea, #target, etc… (See attached) #retail #retailinnovation #retailindustry #retailtrends #retailstrategy #retailexperience #shoppingexperience #stores #brandexperience #brickandmortar #groceryindustry #TopRetailExperts

Whole Foods Market plans to open new, small format stores in urban regions as the chain looks to reach new consumers and untapped markets. The new “mini” store will be called Whole Foods Market Daily Shop, and will range in size from 7,000 – 14,000 SF versus their average footprint of about 40,000 SF. The new concept will not include the store’s standard salad bars or meat counters but will still feature many of the same everyday household items and groceries. The first Whole Foods Daily Shop is slated to open in the Upper East Side of Manhattan this fall. The Company announced that they signed 5 leases in New York City for the concept, with plans to explore other cities across the US later. Amazon (NASDAQ: AMZN) bought Austin-based Whole Foods for $13.7B in 2017. The chain currently operates more than 530 stores and has an estimated grocery market share in the U.S. of 2.4% to rank just behind Aldi, H-E-B, and Dollar General, but ahead of Trader Joe's and Dollar Tree. NNN Trends is your resource for triple net investment data, offering continuously updated national cap rates, comparable sales, and consumer traffic for dozens of national retail tenants. Check it out here: https://bit.ly/4a7BwMA #CRE #grocery #wholefoods #commercialrealestate #crenews

Several years after shuttering its 365 store concept, Whole Foods Market is taking another crack at small-format grocery stores. While 365 was positioned as a less-expensive Whole Foods, Whole Foods Market Daily Shop will feature a greatest hits lineup of WFM products, including grocery and grab-and-go, in urban stores that are about a quarter the size of its traditional stores. The first location will open in New York City's Upper East Side. As the name implies, Whole Foods Daily Shop will be more of a small-basket, high-frequency convenience shopping destination. Whole Foods knows how to operate in urban markets, and companies like Foxtrot are showing there's a lot of demand for small, upscale shops that draw from local neighborhoods. But will shoppers gravitate towards Whole Foods stores that don't have service departments and the large selection of local and specialty items its larger stores feature? Amazon is apparently pleased with Whole Foods' growth, and this launch shows the emphasis it continues to place on operating targeted brick-and-mortar grocery formats. Story by Peyton Bigora

Amazon-owned Whole Foods Market is opening new small-format stores aimed at serving quick-trip urban consumers. Driving the news: Dubbed Whole Foods Market Daily Shop, the stores will range between 7,000 to 14,000 SF, which is much smaller than its standard-sized store that averages 40,000 SF. Be Smart: Whole Foods plans to open its first Daily Shop at 1175 Third Avenue on Manhattan’s Upper East Side by this fall. It has signed five leases in New York City for the concept and will explore expanding into other cities across the U.S. Dig Deeper: The Daily Shop will offer a similar but slimmer assortment of products. The locations won’t have buffet bars or meat counters. Whole Foods operates more than 530 stores. Worth Noting: Whole Foods noted that bigger space is hard to find in urban markets and smaller stores require less time to open. Stores will have cashiers, self-checkout stations, and Amazon’s palm payment service. Heard on the Street: Whole Foods’ Christina Minardi: “The introduction of home delivery has changed customers’ mentality. People want things fast.” (Bloomberg)

Following myriad delays, and potential concerns that the store would not open, Amazon’s Fresh location is now open in Bensalem PA, and I visited it on September 4. The store itself is extremely well laid-out, with adjacencies making it very shoppable. That said, other than proprietary brands, there really wasn’t anything awe-inspiring, and in fact, case-ready beef and seafood is a competitive weakness, especially for a higher-end demographic, which would describe Amazon’s Prime membership base. The Fresh concept is another attempt by Amazon to improve its competitive position in food retail, which despite its much-ballyhooed 2017 acquisition of Whole Foods, remains significantly hamstrung by its lack of meaningful brick-and-mortar compared to its core competitors. Fresh has had a choppy roll-out, with closings, numerous sites abandoned, and several significantly delayed openings, including what will be my local Fresh location in Middletown, PA. While this format is clearly still an experiment with only 49 stores nationwide (contrasts with over 500 Whole Foods stores), it is my supposition that similar to the drivers of Walmart’s Neighborhood Market “mothballing”, staffing of these small formats can and will be challenging. In addition, Amazon will need to flex its logistics network to stock these new stores in the event they ever reach any semblance of scale. Walmart’s logic behind the Neighborhood Market, which I still believe was and remains strategically sound, was to use the Supercenter as the “hub” for the big shopping trips, with Neighborhood Markets “ringing” the Supercenter for fill-in trips, and there was minimal stress on its logistics network. I do not envision Amazon utilizing Whole Foods as a “hub” in this same fashion, and Amazon’s food distribution capability is nowhere near that of Walmart, which will ultimately limit its ability to stock a voluminous physical network. Given all of these challenges, it is difficult to imagine Amazon Fresh stores as anything more than a niche player in grocery, and in fact, may have limited shelf-life, period.

Industry News Update Whole Foods Prepares for National Rollout of Small-Store Format Whole Foods Market is gearing up for a national rollout of its Daily Shop concept, which will begin after the opening of several New York City locations under the small-store format. The first Daily Shop is slated to open this fall on the Upper East Side. The grocer plans to open its second Daily Shop in Manhattan’s Hell’s Kitchen neighborhood. A third New York City Daily Shop will be announced soon, followed by a nationwide rollout. Whole Foods’ Daily Shops will be about half the size of the grocer’s traditional stores, and aim to bring fresh, quality food and ingredients to urban customers. The new store rollout plans align with Amazon’s continued efforts to bolster its grocery business, with recent initiatives including a grocery subscription for Prime members and a growing roster of grocery delivery partners. #grocery #retail #brickandmortar #stores #ecommerce #delivery