Amazon supersizes its Walmart rivalry with new big-box retail concept

Core Insights - Amazon is proposing a new 229,000-square-foot facility in suburban Chicago that resembles a traditional Walmart superstore but incorporates unique Amazon features [1][5] - The store aims to provide a wide range of products, including fresh groceries and household essentials, enhancing customer convenience [2] - Analysts suggest this move reflects Amazon's recognition of Walmart's dominance in the physical retail space, as 93% of Amazon customers also shop at Walmart [5][3] Company Strategy - Amazon's plans are part of its culture of experimentation, indicating a new retail concept designed to excite customers [2] - The company has previously explored various physical retail formats, including the acquisition of Whole Foods for $13.7 billion in 2017 [4] - The new superstore concept is seen as a strategic effort to build a physical presence that can compete with Walmart's scale and utility [5] Operational Features - The proposed store will feature a significant portion of its layout dedicated to "back of house" operations, aimed at improving the shopping experience by reducing conflicts between in-store shoppers and gig-economy workers [6] - A tech-enabled shopping experience will allow customers to request items from the back room via an app or kiosk, enhancing the integration of digital and physical shopping [7][10] - The store design includes dedicated areas for delivery drivers and separate pickup lanes for customers, streamlining operations [10] Market Context - Amazon currently serves over 150 million grocery shoppers in the U.S., generating more than $100 billion in grocery sales in 2024 [5] - Despite Amazon's e-commerce dominance, online shopping constitutes less than 20% of U.S. retail spending, indicating significant market potential [3] - The new superstore is viewed as an evolution of Amazon's previous experiments, such as the automated micro-fulfillment center at Whole Foods [9][10] Approval Process - The Orland Park planning commission has recommended approval of the project, which will be voted on by the Village Board of Trustees on January 19 [11]