Dive Brief:

• Whole Foods Market is gearing up for a national rollout of its Daily Shop concept, which will begin after the opening of several New York City locations under the small-store format, according to a Monday announcement. 
• The grocer also announced plans to open its second Daily Shop at 301 W. 50th St. in Manhattan’s Hell’s Kitchen neighborhood. A Whole Foods spokesperson confirmed that the grocer has five leases in the New York City area for upcoming Daily Shops. 
• A third New York City Daily Shop will be announced soon, according to the spokesperson, and a national rollout “will follow,” per the press release. The grocer did not specify a timeline or what other cities the national rollout will include.

Dive Insight:

The first Daily Shop, originally announced in March, is slated to open this fall at 1175 Third Ave. on the Upper East Side. Whole Foods did not specify an opening date for the Hell’s Kitchen location. 

Like the Upper East Side location, the Hell’s Kitchen Daily Shop will include Amazon One payment technology, self-checkout kiosks and traditional checkout stands, grab-and-go meal options and private label goods, the spokesperson confirmed. 

The grocer added that both upcoming New York City locations will feature Juice & Java, which serves coffee, tea, fresh-pressed juices, smoothies, sandwiches, soups and desserts. 

Whole Foods’ Daily Shops will span between 7,000 and 14,000 square feet — no more than about half the size of the grocer’s traditional stores — and aim to bring fresh, quality food and ingredients to customers with “fast-paced urban lifestyles,” according to the press release.

The expansion of Daily Shop is Whole Foods’ latest attempt at a small-format store and comes several years after the company abandoned its 365 store concept. 

Whole Foods’ focus on New York City as the launch site for Daily Shop builds on the grocer’s 17-store store footprint in the metropolitan area. 

These efforts also signal Amazon’s continued efforts to bolster its grocery arm. Since the launch of Daily Shop, Amazon has introduced numerous new grocery initiatives, including a grocery subscription for Prime members, and added to its stable of grocery delivery partners.

Whole Foods’ foray into small-format, urban stores coincides with the recent difficulties several convenience store retailers have faced with these types of locations. Over the past year, c-store chains like Wawa, QuikTrip and Kum & Go have had to close many or all of their urban, fuel-less locations due to economic challenges. Meanwhile, Foxtrot — whose entire business centered on urban, upscale stores — unexpectedly ceased operations before filing for bankruptcy in May.