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Cashier-free Amazon store 'better suited to the UK'

Amazon's cashier-free bricks-and-mortar grocery store could be a better fit for the UK than the US, experts have said.

The online retail giant has announced it will open a store in Seattle next year and use technology that automatically detects when products are taken from or returned to shelves, allowing customers with the Amazon Go app to walk out of the store without queuing or scanning their items.

Shortly after leaving, customers will be charged for their shopping via their Amazon accounts.

Amazon has not indicated if international stores are planned, but Nicla Di Palma, an equity analyst at wealth manager Brewin Dolphin, said the model may be more successful on this side of the Atlantic.

"I would say that it is even more likely to work in the UK than in the US," he added. "For example, one of the reasons why Fresh & Easy - Tesco's business in the US - did not succeed was that they were focusing on self-checkout, whilst the American consumer likes service.

"Amazon would be a pure play, but I am sure that the other majors could come up with a similar solution. Tesco already has a 'scan as you shop' model."

Self-scanning technology has gained traction in the UK, where cost pressures such as high rents, the national living wage and import cost inflation as a result of the collapse of the pound have encouraged retail models that cut costs, increase sales volumes and reduce wait times, Peel Hunt retail analyst John Stevenson said.

"As a nation I wouldn't say that we fully embrace, but are happy with models like self-scan and, therefore, it could certainly be the next phase," he explained. It could also address issues around self-service, where customers accidentally or purposefully scan items incorrectly, but it could be years before the technology is widely adopted, Mr Stevenson added.

Amazon already has a presence in the British grocery market through a wholesale deal struck with Morrisons. But expansion by Amazon Go could be hindered by limited commercial retail space.

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