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Amazon Is Closing All Of Its Bookstores And 4-Star Stores In U.S., UK

Amazon announced that it would close its Amazon Books stores, which is first opened in 2015, in 2022.

Online retail behemoth Amazon is closing the books on some of its physical store presence in the U.S. and the United Kingdom, including the first type of retail stores it operated: its bookstores. 

Amazon announced Wednesday that it would close all 68 of its Amazon 4-starAmazon Books and Amazon pop-up stores, Reuters reported. In turn, Amazon plans to focus more on its grocery and department store concepts moving forward, Reuters reports.

Amazon operates 600 physical stores in the U.S., the majority of which are Whole Foods Market locations, but it also has grocery brands Amazon Fresh and Amazon Go. Its physical store sales grew 17% over the past year to $4.69B, but that number is dwarfed by the giant's e-commerce online store sales of more than $60B, according to Insider Intelligence. Total sales of its physical store footprint — which launched in 2015 with Amazon Books — account for just 3% of all Amazon revenues, Bloomberg reported.

An Amazon spokesperson told Bloomberg that the retail giant planned to focus more on Amazon Fresh, Whole Foods, Amazon Go and Amazon Style stores, as well as its cashierless store technology, which it has introduced at Whole Foods in D.C. and licensed to Starbucks in New York, moving forward.

“We remain committed to building great, long-term physical retail experiences and technologies, and we're working closely with our affected employees to help them find new roles within Amazon,” the spokesperson told Bloomberg.

Amazon did not provide a timeline for the closures.

The total value of goods Amazon and its third-party providers sold to U.S. consumers last year totaled nearly $379B, a growth of 18.8% over the year prior, according to research by Digital Commerce 360. Amazon is credited with more than half of all gains in e-commerce sales in the U.S. last year, the online e-commerce research firm said.

“Amazon Books put them on the map but there really isn’t a need anymore for that type of store. 4-star was a very interesting concept but never did that well in the bricks-and-mortar space,” Retail Specialists Executive Vice President Bill Read told CoStar. “Nevertheless, the company has concluded that they are not delivering the returns — monetarily or in terms of what they are doing for the wider company — to justify keeping them open. The cost base of the stores is reasonably high because most are located in premium malls where rental costs are high.”