Amazon, the online retail giant, started selling groceries on its website last week.  The line-up consists of over 15,000 non-perishable grocery and gourmet food items, including well-known brands such as Kellogg’s, Pepsi, Campbell’s, and Knorr.

At first glance, it’s difficult to see how Amazon can compete on price once they factor in the cost of delivery and shipping.  The grocery business is cutthroat and the industry is known for its razor-thin profit margins.  Most consumers shop for the best prices, often travelling to multiple grocery stores and fighting with busy crowds in order to complete their shopping lists.

Related: How to save money on groceries

That makes a compelling case for doing the bulk of your grocery shopping online.  With careful planning – allowing three to five days for delivery – you can restock your pantry with a couple of mouse clicks.  Shipping is free on orders of $25 or more, or customers can sign up for Amazon Prime and get free two-day shipping on eligible items, plus one-day shipping for as low as $3.99.  Amazon Prime offers a free 30-day trial, after which the annual membership costs $79.

My guess is Amazon will find a way to compete on price for most items, taking a short-term loss until they’ve influenced the grocery shopping habits of millions of consumers.  Their product line will expand over time, offering even more choices to consumers.

What I like about buying groceries online

I’m not convinced online grocery shopping will replace traditional grocery stores anytime soon, but the service is appealing for a number of reasons.

Restocking the pantry full of dry goods is not something we do on a whim, which makes the three-to-five day shipping window more palatable.  Ordering a bag of flour, a case of apple juice, and a few boxes of pasta and cereal would certainly save me a lot of time and effort.

Related: Is the Costco Executive Membership Worth Buying?

I buy most of those items at Costco where I dedicate an entire afternoon toward driving, parking, navigating the warehouse, elbowing through the hordes of mouth-breathers (who stand in the way while drooling over the samples), waiting to check-out, loading up the car, and unpacking the groceries at home.  Home delivery sounds quite pleasant.

What I don’t like about buying groceries online

Besides the cost, which at this point looks to be higher online than at the regular box stores, grocery shopping is a ritual that deep down most of us enjoy.  We like to touch, feel, and smell what we’re about to buy.  We like to compare items side-by-side, see what others are buying, and chat with shoppers in the produce section.  We get to know the butcher and the baker, and the cashier who rings through our groceries.  We like to check the flyers and shop the sales.  Shopping online can take the fun out of the whole experience.

Related: Christmas shopping online

I’d also feel uneasy if the online service expanded to fresh foods like meat, dairy, and produce.  Obviously the shipping window would have to be reduced to same day service for that to work.  One such service in Ontario called Grocery Gateway offers customers home delivery for online grocery orders, and includes perishable items.  The company has a freshness guarantee which ensures your fresh items arrive with a certain minimum number of days left before expiry.

Final thoughts

Grocery shopping comes down to quality, variety, convenience, and price.  If Amazon can add more brands and items to its product line and keep its prices competitive, they’ll have a huge impact on grocery shopping in Canada.

Consumers will ultimately benefit if the online behemoth succeeds in the grocery business and helps drive prices down overall.

Related: 9 ways to avoid buying things you don’t need

What’s your take: Would you buy groceries online?

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29 Comments

  1. Stephen @ HowToSaveMoney.ca on November 3, 2013 at 8:21 pm

    I saw that Amazon launched this service last week and thought it was interesting. I checked some prices on baby items and currently their prices are only OK. Right now, you won’t be saving any money by buying baby formula from Amazon as it appears to be the same price or higher than at the grocery store.

    If you take sales into account, then you’ll actually be saving money buying at your local store instead of online.

    Well.ca is another great place to buy groceries, baby stuff, and health products online.

    • Echo on November 5, 2013 at 10:18 pm

      @Stephen – I’ll be watching the prices closely to see if they come down at all. 15,000 products sounds like a lot but I didn’t find a lot of brands I typically buy.

      Thanks for the tip on Well.ca

  2. Nicole on November 4, 2013 at 6:00 am

    I shop for sales, use coupons, price match, and always check the clearance or markdown sections. I don’t think I will ever online shop.

  3. CanadianDaniel on November 4, 2013 at 7:07 am

    In-person grocery shopping makes more sense, at least for me and my wife. We live within a 10-minute walk from 4 competing grocers, and can take advantage of door-crasher deals and end-of-line specials on produce and bread. In the summer, for example, Longos had a $1 for a dozen corn sale — a price I hadn’t seen in decades. Another grocer rotates out bread approaching their expiry dates for a $1. It’s convenient and fun to shop for these bricks-and-mortar bargains, plus we get exercise.

    • Echo on November 5, 2013 at 10:21 pm

      @Daniel – I’m close to a few grocery stores as well so it’s not too bad to shop the sales there once a week. And since you’d have to buy your fresh foods anyway, you might as well grab your staples while you’re at it.

  4. Gary on November 4, 2013 at 7:34 am

    I am basically pretty lazy so we will probably check this out in the spring. Do you know if this service could be used on both sides of the border like Costco? My biggest question would be: what if no one is home when your order arrives?

    • Echo on November 5, 2013 at 10:24 pm

      @Gary – You’d have to use Amazon.com on the U.S. side and Amazon.ca on the Canadian side. I suspect the Amazon Prime membership is country specific, too, so if you wanted to faster shipping you’d need a membership on both sides.

      Not sure what happens if you’re not home when they deliver – can someone else here answer that question?

  5. Jane Savers @ Solving The Money Puzzle on November 4, 2013 at 8:43 am

    It’s all about price for me and right now no one beats Costco for toilet paper, detergent and bulk food like rice and oats. I use my Costco Amex for extra bonus points.

    I would buy from cheapest supplier if I knew that the products were of a good quality and Amazon would probably guarantee that.

    • Echo on November 5, 2013 at 10:25 pm

      @Jane – Costco is pretty tough to beat on some of those items.

  6. Glen Craig on November 4, 2013 at 9:11 am

    The Amazon service seems interesting. I hope they open up the service near me soon.

    We have a couple of other options that are similar. We used one for a while and it really did a lot to save us time and aggravation. We had a young baby in the house and it was tough to head out for food shopping. Doing it online cost us a bit more but not having to bundle the kids up to head out was such a nice return for the cost.

    • Echo on November 5, 2013 at 10:27 pm

      @Glen – We dread the monthly Costco trip for that reason – bundling up the kids and spending an entire Saturday afternoon at the store is not my idea of a good time. Still, I wouldn’t pay a huge premium – the prices would have to be very close.

  7. Miranda on November 4, 2013 at 9:28 am

    We buy some of our non-perishables on Amazon. We get our pasta from Amazon, and buy our pasta sauce direct from Rao’s. This saves us money over the grocery store, and it allows us to buy in bulk so we can build our home food storage at the same time. We order other things online as well. We also have a produce box and our milk delivered each week from a local farm. It’s not exactly online, I guess, but it works for us.

    • Echo on November 5, 2013 at 10:28 pm

      @Miranda – What happens when you’re not home to receive the order?

  8. Turia on November 4, 2013 at 11:31 am

    We were in the UK for four months this summer, living in a tiny village with no grocery store, and we did 95% of our grocery shopping online through Ocado (www.ocado.com). All the big stores there are now doing it- Tesco, Sainsbury’s, etc.

    Ocado guarantees to price match with the other stores, offers one-hour delivery windows, you can order up to 21 days ahead, or as little as the day before, you can often get free delivery if you order in advance, you can edit and change your order up until 12 hours before delivery, they provide freshness guarantees for anything perishable, and they make getting refunds (for the inevitable broken eggs) super easy to process online.

    I would take that ANY day over the nonsense of having to get to multiple stores here (we don’t own a car). I tended to pick up a lot of fresh fruit at the farmer’s market in the town centre when I was cycling home, and we mainly bought our meat from the butcher down the road, but everything else came from our weekly online shops. It was lovely to sit on a Sunday night and order groceries while chatting with my husband and drinking a glass of wine.

    The online shopping doesn’t work well for those who don’t work from a list, or make menu plans- it’s not easy to just troll through the site and see ‘what I feel like’. But if you have a list, it is so easy. We miss Ocado mightily now that we are back in Ontario.

    • Peter on November 5, 2013 at 7:55 pm

      One of our sons lives in the UK. His comments exactly echo yours. Not having to grocery-shop also allowed him and his wife to live without a car, using public transport and renting a car for trips – and thus saving another considerable expense.

      The stores usually pack the orders overnight. If you can take daytime weekday delivery, delivery will often be free. You can reject anything you don’t like the look of. You can save your own “default” shopping lists for staples, etc. And of course UK grocery stores sell alcohol ….

    • Echo on November 5, 2013 at 10:29 pm

      @Turia – that sounds like an awesome service.

  9. MoneyAhoy on November 4, 2013 at 1:04 pm

    I think I’d buy almost anything that wasn’t produce type of stuff where it would matter what you picked and if it were the proper ripeness.

    I’m going to look into getting more of our non-perishables setup through Amazon to save us money.

  10. Hannah on November 4, 2013 at 7:36 pm

    I grew up in a business family. We grew up with the mantra that you took care of the town and the town took care of you. We always bought from the independent businesses. I married into a business family and the mantra was the same. I would never buy from Amazon. I support local and independent.

    • Echo on November 5, 2013 at 10:31 pm

      @Hannah – I can definitely respect and appreciate that point of view. Thanks for sharing!

  11. Betsy @ ConsumerFu.com on November 4, 2013 at 8:50 pm

    I will definitely consider buying certain items online. I live in a farming community and grow much of the fruits and vegetables we eat throughout the year. We don’t live near a grocery store and I have no problem with having certain items delivered to my door.

  12. Brian @ Luke1428 on November 4, 2013 at 8:55 pm

    We’ve just become Prime members and are going to check out purchasing more things like this from Amazon.

    • Echo on November 5, 2013 at 10:32 pm

      @Brian – Let us know how it goes! I’d like to sign up this month and give it a try over the Christmas holidays.

  13. dojo on November 5, 2013 at 9:10 am

    Our friends in the US have bought coffee on Amazon for years. They like a German brand which is hard to find or more expensive in the stores. As long as we’re talking ‘non-perishable’ goods, I see no problem. Instead of driving to the store, carrying the products to my car etc., I can just click and buy the stuff.

  14. Cash Cow Couple on November 5, 2013 at 9:44 am

    We do purchase some groceries online at Amazon and Vitacost. They are mostly specialty items like ground flax seed or other specialty flours. We’ll also buy some oils and spices online in bulk.

    Our main consideration is price. Most healthy specialty items are outrageously priced at local stores.

  15. Ed on November 5, 2013 at 10:15 pm

    Online Grocery shopping option makes sense to those who do not have a vehicle,have some kind of phobia,are afflicted with a mobility issue,are sensitive to the cold or heat, or just would rather have someone else battle the line ups.

    I can see there is a market for this type of shopping. Myself I like the experience…..but that may change in years to come.

  16. Kat on November 6, 2013 at 2:45 pm

    I would say that this would take away the local jobs if people start buying online.

    The only advantage that I would see from this is if you’re at home with young ones, homecare/daycare, lives in rural areas, or elderly/disabled people who may not be able to get around easily especially in the winter.

  17. My Own Advisor on November 6, 2013 at 6:54 pm

    I’m with you my friend. Count me out.

    We enjoy touching, feeling and looking at our food before we buy it. We buy mostly produce anyhow, and try to avoid more and more, things that are processed and coming in 4 packages.

    We also try and support our local community and farmer’s markets during the season.

    Mark

  18. Elizabeth on November 6, 2013 at 6:58 pm

    I could see myself ordering some items online if I got hit with a bout of the flu. It would be nice to have some crackers, gatorade and apple sauce come to my door!

    I mostly buy fresh foods so I don’t think Amazon would be the place for me to shop. I like to buy local if I can, and I doubt online can beat my local farmers’ market!

  19. Bryan Jaskolka on November 8, 2013 at 1:21 pm

    While many of us might not “buy dry goods on a whim,” many of us – especially those of us who love to cook and try new recipes the moment we find them – do. The other thing I don’t like it about it is that it’s just like those self-checkouts: they take away from people’s jobs.

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