Amazon Bets Big on Selling Cashierless Technology to Retailers After Scaling Back U.S. Store Use

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Amazon is doubling down on its revolutionary cashierless technology, “Just Walk Out,” after pulling it from most of its U.S. stores. The company is now focusing on selling the tech to third-party retailers, marking a strategic pivot in how it envisions the future of brick-and-mortar shopping.

Amazon, which once planned to integrate Just Walk Out into thousands of its own stores, has shifted gears after cost-cutting measures led to the removal of the system from its Amazon Fresh and Whole Foods locations earlier this year. The move was part of CEO Andy Jassy’s broader initiative to scale back operational expenses and rethink Amazon’s retail strategy. Now, the company is banking on third-party retailers adopting the technology, a shift that has been met with both anticipation and skepticism.

In a recent Bloomberg report, it was revealed that Amazon’s Just Walk Out technology will continue to be used in its grab-and-go convenience stores and UK Fresh locations, as well as in stadiums, airports, and hospitals. Meanwhile, Amazon Fresh stores in the U.S. will feature Dash Carts, which allow shoppers to skip checkout lines by tracking items placed in the cart in real time.

Despite removing Just Walk Out from its own supermarkets, Amazon insists the technology is still a crucial part of its vision. “This isn’t a retreat; it’s a strategic focus,” said a company spokesperson. “We’re scaling Just Walk Out with third-party retailers and have seen tremendous interest from businesses across the country.”

Since launching Just Walk Out in 2018, Amazon initially envisioned a future where the system would dominate grocery shopping. However, the high cost of implementing the technology has proven challenging for large-scale supermarket chains. The cost of installing the extensive camera networks and shelf sensors needed for Just Walk Out has led many retailers to opt for simpler mobile checkout solutions.

But that hasn’t stopped Amazon from pushing forward. In fact, the company has already inked deals with over 200 third-party retailers to install the cashierless system, and it expects to double that number by the end of the year. One example of the technology’s success is at Seattle’s Lumen Field, home of the NFL’s Seahawks, where Amazon reported a 112% increase in sales after implementing the system.

The company has also made improvements to the technology, introducing a new AI system that processes data faster and more accurately, making it easier for retailers to deploy the technology in small to medium-sized stores.

The decision to focus on selling the technology to other retailers mirrors Amazon’s previous successes with Amazon Web Services (AWS). Originally developed to handle Amazon’s IT infrastructure, AWS has since become the company’s most profitable division, selling cloud services to other businesses.

“There will always be more third-party stores in the world than first-party stores,” said Jon Jenkins, Amazon’s former vice president of Just Walk Out, who recently departed the company. “The success of this project will depend on third-party adoption.”

While Amazon is determined to make Just Walk Out a mainstream shopping experience, convincing retailers to trust one of their biggest competitors with valuable customer data remains a challenge. However, with the technology now under the purview of AWS, Amazon hopes to ease those concerns and focus on scaling the system nationwide.

Analysts agree that Amazon faces an uphill battle, but the potential for success is still there. “Amazon is in sales mode right now,” said Sucharita Kodali, a retail analyst at Forrester Research. “It’s a long road ahead, but if they can prove the value to retailers, the technology could become ubiquitous over time.”

For now, Amazon is betting that patience, data, and the allure of seamless shopping will pave the way for Just Walk Out to become a game-changer in retail.