Grocery margins are razor-thin for 2 reasons: 1. Most of the money in grocery is in perishable foods. There's also a huge amount of shrink from product spoilin

Grocery margins are razor-thin for 2 reasons: 1. Most of the money in grocery is in perishable foods. There's also a huge amount of shrink from product spoiling or being damaged -- A truck driver having a bad night can easily lose 2-3 pallets (288 gallons each) of milk. If the cooler or freezer is full, pallets of product sometimes get left in the backroom aisle. 2. Unions forcing exceptional medical plans. When I worked for Safeway, and was part of UFCW Local 367, I had the best medical care I've ever had -- PPC network with low copays and it included ~$600 of dental and glasses lenses/frames every year/two. And we had no deductible as long as we worked more than 20 hours per week. Amazon won't have any stores, so they'll be avoiding both of these costs.