Seattle Prime customers of online retailer Amazon.com Inc will now be able to order food from restaurants in the area using the company's app.
Reuters reported on Tuesday that food delivery at no extra charge is now available at Amazon's Prime Now, whose estimated 40 million subscribers worldwide pay $99 annually for a range of services including one to two hour deliveries for thousands of items.
Reuters noted that Amazon's own couriers will be delivering food to customers unlike in Amazon Local, where customers similarly were able to order from restaurants which took care of deliveries. The wire agency added that Amazon will enter an industry that has thin margins and it faces a range of competitors such as GrubHub and even Uber Technologies Inc, which recently expanded its services.
Bloomberg, meanwhile, said Amazon's expansion into food delivery follows its announcement last month that it will deliver alcoholic beverages. It added that more Americans are eating out, with spending in restaurants and bars topping groceries for the first time in March. The report said people ordering take outs benefit restaurants as this allows them to entertain more customers.
Reuters said Amazon will get a cut of the profit from orders made through the app on its partner restaurants. The report quoted Gus Lopez, general manager of Amazon Restaurants, saying the Seatlle experiment allows the company to learn about the service but the online retailer would not divulge other areas it plans to expand in.
The wire agency, however, checked Amazon's LinkedIn page and found that it has been hiring staff for a restaurant division in New York as well, but added that the company said this does not mean it is expanding there. Reuters also noted that Prime Now is currently available in 11 markets including Chicago, Atlanta and London.
