Amazon Offers Restaurant Delivery To Prime Members In UK

Amazon.com, Inc. (NASDAQ:AMZN) has launched a restaurant food delivery service in London that is exclusively available to its Amazon Prime subscribers and that too free of cost. Many popular food chains and restaurants such as Strada, Planet Hollywood, Benares and Gastronomica are covered by the service.

We note that this is an extension of its food delivery service launched last year in Seattle called Amazon Restaurants that now offers its services in 14 additional cities in the U.S.

This is a very smart move by the online retail giant as it aims to add more subscribers to its £79 a year Amazon Prime service in UK.

How it Works?

Amazon Prime subscribers need to go to the Prime Now app and select the postal code of their area. A list of participating restaurants is shown. Customers can then select the restaurant of their choice, browse through the menu and place an order. Additionally, the app also enables users to track the delivery of their order in real time.

Customers can expect the delivery at their doorstep within an hour. Moreover, Amazon has declared that orders worth £15 or more will have no menu mark ups or additional charges. .

Fierce Competition

The food delivery space in the UK is marked by the presence of heavyweights such as UberEATS and Deliveroo.

UberEATS: This food delivery service offered by Uber costs between £2 and £2.50 per order. However, unlike Amazon, it doesn’t have a threshold for minimum order price.

Deliveroo: Deliveroo offers its food delivery services to restaurants in the UK that don’t have their own home delivery service. It pays drivers to collect the food from the restaurants and deliver the same at the customer’s doorstep.

As per some media reports, the meal takeaway market in Britain for food items such as pizzas and curries is worth around £8 bn a year and with Amazon’s huge base of UK Prime subscribers, the company looks poised to take a bite of that pie.

So, despite the minimum order threshold of £15 to avail the free delivery service, we expect Amazon to do well in the UK.

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Zacks Rank & Key Picks

At present, Amazon carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the broader technology space are Autobytel Inc. (NASDAQ:ABTL) , Stamps.com Inc. (NASDAQ:STMP) sporting a Zacks Rank #1 (Strong Buy) and PetMed Express, Inc. (NASDAQ:PETS) , carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Interested in IPOs? Check out the special edition of Zacks Friday Finish Line below, where Editor Maddy Johnson and Content Writer Ryan McQueeney interview Kathleen Smith of Renaissance Capital about the IPO market in 2016 (see part two here).

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