Morrisons and Amazon expanding same-day deliveries

Morrisons and Amazon say they will expand their same-day delivery service for groceries to Glasgow, Newcastle, Liverpool, Sheffield and Portsmouth.

Morrisons agreed to supply Amazon with groceries in 2016 and the service now includes delivery within the hour for some customers.

So far shoppers in Leeds, Manchester, Birmingham and some parts of London can use the same-day service.

More cities will be added in "future years," the two companies said.

Yesterday, Waitrose & Partners said it would extend its own two-hour delivery service beyond London, to Bath and Hove.

In a tweet, Natalie Berg, an analyst at NBK Retail said: "Deliverywars are on! As a customer, I think Prime Now is still pretty clunky but getting groceries delivered in a couple of hours is definitely game changer."

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Morrisons and online supermarket Ocado agreed a distribution deal in 2013, which gave Morrisons an online option, years after its main rivals had already done so.

The supermarket supplies products for the Amazon Prime Now and Amazon Pantry services.

Amazon Pantry was launched in the UK in 2015, escalating competition with the big four supermarkets, but it did not initially offer fresh food.

Ocado has a 25-year agreement with Morrisons to run the supermarket's online delivery service.

Market share

The four largest supermarkets are gradually losing their dominance in the UK.

Sainsbury's, Morrisons, Tesco and Asda are all seeing their share of the market drop, although between them they still account for more than two thirds of spending on grocery shopping.

Discounters Aldi and Lidl's approach, with fewer product lines and lower prices, has forced big supermarket chains to cut their own prices and costs.

Yesterday, Lidl said it would open 40 new stores in the south east of England, adding to the pressure the big four's stores are feeling.

Sainsbury's and Asda attempted a merger earlier this year, in a bid to cut costs. However, their deal was blocked by the Competition and Markets Authority.