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UK grocers brace as AmazonFresh arrives

Thursday, June 09, 2016 - 01:34

Amazon has launched a British version of its AmazonFresh food delivery service in a long-anticipated move by the world's largest online retailer to break into the UK grocery market. Hayley Platt reports.

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This is what the UK's big supermarkets have been dreading. Amazon on Thursday launching fresh food deliveries in the country. It's aiming to grab part of a booming market. UK online food shopping expected to double to over 17 billion pounds a year by 2020. The Amazon Fresh service just a trial for now, and confined to parts of London. SOUNDBITE (English) SENIOR FX STRATEGIST, RABOBANK, JANE FOLEY, SAYING: "I think the supermarkets are likely to be quite concerned in the UK. We've known for some years that there's been on-off price wars, a lot of pressures within the sector. So to have another big player who already has a very established delivery base will be obviously a significant concern to many of the incumbents in that space." Amazon's arrival in the market comes at a tough time for the supermarkets. They're already fighting a price war sparked by discount rivals Aldi and Lidl. That has sapped profits across the sector. But it may also have helped the grocers prepare for battle: SOUNDBITE (English) REUTERS RETAIL CORRESPONDENT, JAMES DAVEY, SAYING: "It's much more profitable for the retailers for customers to visit their stores than if they do it online, so make their stores more attractive, improve product availability, improve customer service - do a lot of the things they're already doing to answer the threat of the discounters." Supermarkets hope point card programs also give customers a reason to stay loyal. But Amazon has a history of disrupting every market it enters. Thursday's launch may just be an initial skirmish, but battle has been joined.

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UK grocers brace as AmazonFresh arrives

Thursday, June 09, 2016 - 01:34