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Amazon teams with Manhattan stores for one-hour grocery delivery

The online retailer expands its Prime Now rapid-delivery service to include prepared meals and baked goods for certain neighborhoods in Manhattan, starting Thursday.

Amazon's Prime Now is planning to expand its coverage area for groceries and add more stores. Amazon

Amazon is working with a handful of stores in Manhattan to expand its one-hour delivery service to include pasta salads, cookie sandwiches and rotisserie chickens.

The e-commerce giant said its Prime Now speedy-delivery service -- which offers thousands of items from paper towels to TVs in several US cities -- will deliver groceries, prepared meals and baked goods from D'Agostino, Gourmet Garage and Billy's Bakery to specific Manhattan neighborhoods beginning Thursday. Prime Now already offered frozen and chilled foods, such as frozen broccoli or yogurt.

Local store delivery will become available across Manhattan in the coming weeks, with more stores being added to the service. Upscale Italian market Eataly and Westside Market will be the next to launch, Amazon said. The grocery service will also open in more cities, a company spokeswoman said.

The new partnership with local stores keeps up Amazon's mission of becoming the primary source for most purchases for its Prime members, who pay $99 a year for free, two-day deliveries of products as well as other perks. Prime members tend to spend much more on Amazon than regular shoppers, so Amazon tries to keep them coming back with faster deliveries, streaming video and music services, and cloud storage.

Amazon already offers same-day deliveries of groceries and dry goods in certain markets through Amazon Fresh, but the Prime Now expansion on Thursday may put Amazon in even more direct competition with other grocery delivery services, such as Peapod, FreshDirect and Google Shopping Express. Also, shipping from local stores has become a popular strategy for speeding up deliveries, with Google, Target and other retailers setting up similar distribution channels.

Prime Now is available for Prime members through an app on iOS and Android devices. Prime Now two-hour delivery from local stores is free and one-hour delivery, available in certain ZIP codes, is $8. Prime Now, which first launched in December, is available in Atlanta, Austin, Baltimore, Brooklyn, Dallas, Manhattan and Miami.