The Real Reason Amazon Fresh Is Constantly Out Of Stock On Major Items

In 2017, Shannon Gupta reviewed the month she had spent using Amazon Fresh. Writing for CNN, she decided that for some, the grocery delivery service may make sense, but she did note the occasional unreliability of Amazon Fresh: "After placing one of my Fresh orders, I received an email that the brand of paper towels I'd purchased was out of stock. Amazon said I wouldn't be charged for the item and would instead receive a similar pack of paper towels for free." Barely an inconvenience, but something worth mentioning.

A year later, however, the problem still persisted and patience thinned. Business Insider reported on how customers had noticed a decline in the then 11-year-old service, such as how often their packages lacked items ordered. They reported that Amazon Fresh's policy on out-of-stock items stated, "When possible, we'll try to substitute the unavailable item with a similar product (exceptions are specialty items)," and the customer will be notified. But the customers interviewed said they didn't always get a notification, making them wonder whether the item was out of stock or if the fulfillment center failed. 

The only reason for Amazon, the biggest logistics operation ever, to have failed in this regard, is if the service didn't receive their attention. They may just be stretched too thin. Investor Place cites the creation of Prime Now and the acquisition of Whole Foods as the reasons behind the confusion on Amazon's end. After all, why bother coordinating between two platforms if your customer can just order through Whole Foods?

The reason many may choose to use Amazon Fresh over Whole Foods is the promise of savings. Upon hearing about Whole Foods' acquisition, SFGate compared prices on a set of groceries, seeing that if people bought the cheapest option each of the two sold, Amazon Fresh would cost $107.37 and Whole Foods would cost $128.40.

To cater to this audience, Amazon decided to open an Amazon Fresh store, as CNN reported in August 2020. According to Amazon, the stores boast book pick up, same-day delivery, and regular store perusal. Presumably, with actual stores, Amazon Fresh stores would be able to navigate the needs of their local consumer base better. 

Unfortunately, they chose to debut their new franchise during 2020, the year where all supply lines were ravaged by the pandemic. As GeekWire reported during the onset, even Amazon Prime, the functional delivery service, could not keep up with the rapid increase of orders from its 150 million users. Still, as things return to a more manageable pace and Amazon Fresh stores expand their reach to the Twin Cities, as KSTP predicts, and beyond, the problem of running a fresh grocery business through an Amazon infrastructure may resolve by collapsing it into a store format.