Why Amazon’s Struggles with Physical Stores Matter for Canadian Shoppers

Personal Finance Edition

Sep 19, 2025

Dear Valued Subscribers,

Amazon has long dominated e-commerce, reshaping the way consumers shop worldwide. But its struggles to succeed in physical retail—from Amazon Go stores to bookstores and fashion outlets—raise an important question: If Amazon can’t make in-person retail work, what does that mean for the future of brick-and-mortar shopping, especially in Canada?

With the rise of cashless, automated stores and the growing influence of AI-driven retail, Canadians may soon see major shifts in the way they shop. Here’s what Amazon’s failure in physical retail could mean for the future of shopping in Canada.

Amazon’s Struggles with Physical Retail

Amazon’s Go stores, introduced in 2018, promised a futuristic shopping experience—letting customers grab items and walk out without stopping at a checkout. However, since 2023, Amazon has closed about half of its Go locations, alongside shutting down bookstores, fashion outlets, and 4-star stores.

Why? Amazon miscalculated the appeal of its retail model.

🔹 Technology over customer service: Many shoppers still value human interaction—a helpful cashier or a friendly store associate. Amazon Go’s cashierless system lacked the personal touch that traditional retailers offer.

🔹 Cashless stores limit accessibility: Many Canadians, especially in rural areas or lower-income communities, still rely on cash transactions. Stores that prioritize credit and debit payments exclude a portion of the population.

🔹 Retail isn’t just about efficiency: Amazon’s e-commerce model is built on convenience and speed, but in-person shopping is often about experience and discovery—something Amazon has struggled to deliver.

What This Means for Canadian Shoppers

1. The Future of Cashierless Shopping in Canada

While Amazon may be scaling back its own cashierless stores, it is licensing its “Just Walk Out” technology to other retailers, including stadiums, universities, and grocery stores.

🔹 Could this technology come to Canada? Yes.
Retailers such as Loblaws, Metro, and Sobeys are already testing AI-driven checkout systems. However, Canada’s payment regulations and preference for bilingual customer service may slow adoption.

🔹 Will it replace traditional stores? Unlikely.
Despite Amazon’s push for automation, most Canadians still value in-person service—especially in grocery and convenience shopping.

2. Will Grocery Shopping Change in Canada?

Amazon’s biggest focus in physical retail has been grocery stores, with its Whole Foods Market and Amazon Fresh brands. In Canada, grocery prices are a major concern, and competition between Loblaws, Walmart, and Costco continues to shape consumer habits.

📌 What does this mean for Canadians?

More automated checkout experiences may be introduced in grocery stores.
Grocery delivery and subscription services (like Amazon Fresh) could expand in Canada, challenging existing services like PC Express and Instacart.
Price competition may increase, as Canadian grocers invest in technology to reduce costs and improve margins.

3. Will More Big-Box Retailers Struggle?

Amazon’s failure in brick-and-mortar retail highlights a broader challenge: The way Canadians shop is changing.

📌 Consider these trends:
✔️ More Canadians prefer online shopping – E-commerce in Canada continues to grow, with over 80% of Canadians making online purchases regularly.
✔️ Smaller, local retailers are thriving – Shoppers are prioritizing Canadian brands and independent businesses, especially after the pandemic.
✔️ Big-box stores are adapting – Walmart Canada and Best Buy Canada are shrinking their store footprints and integrating e-commerce more effectively.

Amazon’s missteps suggest that simply opening physical locations isn’t enough—retailers need to rethink how consumers interact with stores in an era where shopping habits are increasingly digital-first.

Final Thoughts: The Canadian Retail Landscape is Changing

Amazon’s failures in physical retail underscore a larger shift in Canadian shopping habits. While cashierless technology and AI-driven stores may grow, the demand for human connection, fair pricing, and seamless online-to-offline experiences remains strong.

🔹 For Canadian shoppers: Expect more automation in grocery and convenience stores, but don’t expect cashiers to disappear overnight.
🔹 For Canadian businesses: Small and mid-sized retailers should focus on personalized service and hybrid shopping experiences to stay competitive.
🔹 For investors and entrepreneurs: The future of retail isn’t just automation—it’s about balancing efficiency with customer engagement.

Amazon may be the king of online shopping, but its struggles in physical retail show that brick-and-mortar stores aren’t going anywhere—they’re just evolving. How Canadian retailers adapt will determine their success.

Warm regards,