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These Are the Steps Amazon Is Taking to Fix Its Grocery Delivery

By Daniel B. Kline – Apr 15, 2020 at 9:43AM

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The company has had to stop taking new customers while it struggles to add capacity,

Amazon.com (AMZN -1.57%) has seen demand exceed capacity when it comes to its ability to deliver groceries. That has forced the retailer to make a number of changes while it works to increase capacity.

For now, the company has been asking new Amazon Fresh and Whole Foods delivery and pickup customers to "sign up for an invitation to use online grocery delivery and pickup," according to a blog post. The retailer explained that it's adding capacity each week and plans to steadily invite new customers in.

The exterior of a Whole Foods

Whole Foods has been struggling to meet delivery demand. Image source: Amazon.

What steps is Amazon taking?

Amazon has added 100,000 workers since March 16. It has already begun filling another 75,000 jobs it's adding to handle the increased demand. It has also cut hours at some Whole Foods locations in order to focus on filling delivery and pickup orders.

The retail chain noted that it has increased capacity by 60% "due to COVID-19." It has been hampered, however, by not being able to serve as many people in its brick-and-mortar locations due to social distancing restrictions.

"To help, in the coming weeks, we will launch a new feature allowing customers to secure time to shop," the company wrote. "This feature will give delivery customers a virtual 'place in line' and will allow us to distribute the delivery windows on a first-come, first-served basis. Simultaneously, we will continue to add capacity as swiftly as possible."

Adjusting on the fly

No retailer could have predicted this type of surge in demand for such a sustained period. Amazon is doing its best to adjust quickly to this new (hopefully short-term) reality. The company has been aggressive in addressing its shortcomings, and that's really the most that can be expected.

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Daniel B. Kline has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Amazon and recommends the following options: short January 2022 $1940 calls on Amazon and long January 2022 $1920 calls on Amazon. The Motley Fool has a disclosure policy.

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