Amazon.com Inc.’s Japanese unit and Life Corp., one of the country’s major supermarket chains, said Thursday they will join forces to sell fresh foods online starting later this year, aiming to attract elderly and busy customers.
In Amazon’s first tie-up with a Japanese supermarket operator, Life will supply a range of products, including those from its in-house brand, to members of Amazon Japan’s Prime Now service, which touts delivery times as fast as two hours for orders.
The service will start in parts of Tokyo later this year, with Amazon Japan handling delivery and processing payments. It hopes to cater to growing demand from the elderly and people who have difficulty getting to physical stores while also targeting busy professionals, especially in dual-income households, who have little time for grocery shopping.
Through the collaboration with Life, Amazon Japan expects to be able to expand its product offerings, while the Japanese supermarket operator hopes to reach a younger customer demographic and people who live in areas without its stores. Stores run by Osaka-based Life are concentrated in the Tokyo metropolitan area and in western Japan prefectures.
Life already operates an online service giving customers access to approximately 6,000 products, but its delivery area only covers around 50 to 60 percent of the Tokyo metropolitan region and comprises less than 1 percent of total annual sales at around ¥3 billion.
For Life, the tie-up with Amazon Japan will also be helpful in dealing with the nation’s widespread labor shortage.
Other major Japanese supermarket market operators such as Aeon Co. and Ito-Yokado Co. have moved into online fresh food sales, but profitability remains a challenge due in part to high delivery costs.
Major online retailer Rakuten Inc. and U.S. retail giant Walmart Inc.’s Japanese subsidiary, Seiyu GK, also began an online supermarket operation last year.