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Amazon expands Prime Now service in San Francisco, focusing on small businesses

Amazon is being careful in rolling out its Prime Now service and its strategy is no more evident than in its recent expansions in the Bay Area, where it is partnering with local groceries and other small businesses.

Prime Now customers in the Bay Area can now shop for their beauty supplies from regional chain Peninsula Beauty, procure pet products from Bay Area staple Pet Food Express and Prime members in the East Bay from Hayward to Richmond (including Berkeley and Oakland) will be able to have fresh grocery products from nearby Sprouts Farmers Market locations delivered to their door via Prime Now.

“Prime Now is excited to continue our commitment to adding more local stores to the service bringing Prime members more convenience and selection of the products they love,” said Amanda Ip, spokeswoman for Amazon Prime Now. “Prime Now provides superfast delivery on tens of thousands of items that we know customers want to get delivered to their door in an hour or less.

“We also align with strong, local brands that offer Prime members high-quality products and great selection.”

Bay Area
Currently, Prime Now offers a range of products for delivery, many of them available from local small businesses. Amazon even offers alcohol delivery through Prime Now, with Tony’s Market & Liquor and Sousa’s Wine and Liquor becoming early adopters of Amazon’s quick delivery service.

Deliveries involving small businesses are usually timed on the merchant’s basis, and Prime Now rates apply: $7.99 for one-hour delivery and two hour delivery being free.

Prime Now’s expansion also comes at a time when the Prime service at large is expanding internationally: Earlier this week, Amazon Prime launched in Mexico, contributing to the continuing growth of online retail in the country. The launch is Amazon’s first in Latin America, which is relatively uncharted territory in ecommerce as large-scale online retailers focus on North America and Asia.

Amazon Prime Now
Amazon debuted Prime Now in 2015, and since then it has expanded the service to over 5,000 cities. While uptake has been strong, the delivery service is still only relegated to certain items; consumers will have to wait for the company to scale its delivery services (Amazon Pantry will probably prove to be a litmus test for the kind of load its delivery infrastructure can handle) before Prime Now becomes more ubiquitous within Amazon’s offerings.

The company was recently forced to lower its minimum order for free shipping to $35 — the same minimum Walmart instituted on free two-day shipping not three weeks before, after the latter posted promising Q4 numbers from last year (see story).

And don’t think Amazon is only interested in delivery: the company is continuing to move further into physical retail with its latest offering — a bricks-and-mortar grocery store where consumers can purchase items through an app and then just grab them off of the shelf (see story).

“I can’t comment on our future roadmap but I can tell you that our customers love the convenience of shopping for tens of thousands of items on Prime Now from staples like milk, eggs, and even ice cream to pet toys and beauty supplies from local stores and getting everything on their list delivered to their door in an hour or less,” Ms. Ip said.