According to This article in DC Velocity magazine published on 12/3/14, Amazon is set to roll out its Fresh grocery business to 30-40 US markets this year, supported by a major re-organisation of its distribution network and fulfillment model. The article, which quotes a supply chain consultant with close connections to Amazon and has been corroborated by other industry sources, confirms Amazon's strategic intention to combine delivery of groceries with general merchandise using its own fleet of trucks to lower distribution costs and improve service levels in urban areas.
Meanwhile Amazon is working hard to integrate Kiva's automated goods-to-person picking systems in its warehouses. This should enable it to achieve the kind of pick rates necessary for grocery order fulfillment - i.e., at least triple the 100-150 items per hour it manages with traditional person-to-goods picking. By lowering fulfillment and distribution costs in this way, Amazon could soon be in a position to offer fast, efficient and low-cost grocery delivery to around half the US population. Are you ready for that?