Amazon to Put New Online Grocery Shoppers on Wait List to Meet Surging Demand

Amazon.Com Inc. (AMZN) is asking new online grocery customers to join a wait list and is shortening store hours at some Whole Foods stores as it seeks to handle “unprecedented demand” for online food delivery orders from existing customers who are stranded at home as a result of nationwide coronavirus-related lockdowns.

The world’s largest online retailer, who bought Whole Foods back in 2017, said the surge in demand and social distancing regulations have put limits in its ability to increase the capacity of its delivery services. As a result, Amazon is asking new Whole Foods and Amazon Fresh online grocery delivery customers to temporarily sign up on a wait list. In addition, it ​also plans to curtail some Whole Foods stores’ hours so its employees can be freed up to handle online grocery orders.

“We’re increasing capacity each week and will invite new customers to shop every week,” Amazon said in a blog statement. “We still expect the combination of restricted capacity due to social distancing and customer demand will continue to make finding available delivery windows challenging for customers.”

Since the coronavirus outbreak, Amazon’s online grocery order capacity has increased by more than 60%. In March, the online retailer said it would hire an additional 100,000 people to help meet demand, including for grocery delivery, and invest more than $350 million to support employees during the pandemic crisis.

In recent weeks, it increased the number of Whole Foods stores offering grocery pickup ​to more than 150 locations, up from 80 previously. It also offered better pay to encourage its warehouse workers to work for its grocery delivery service.

Amazon enjoys a Strong Buy consensus rating based on 39 Wall Street analysts covering the stock in the last three months who are split into 38 Buys and 1 Hold. The $2,429.97 average price target implies a 19% potential gain in the shares in the coming 12 months. (See Amazon stock analysis on TipRanks).

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