This would be a good idea if so many of us weren't already sold on the idea of supporting Costco because it treats employees so well. I'm a Prime customer, and I would never use this service unless Amazon cleans up its act and pays a living wage. We know that won't happen, because low-paid, desperate workers are the grease in the Amazon wheels. It's up to progressive activists and orgs to educate the public about Amazon, the same way we did for Walmart:

SAN FRANCISCO — Amazon.com is working on a new business called Pantry that will help it expand further into the giant consumer package goods market and take on warehouse club stores Costco and Wal-Mart's Sam's Club, according to three people familiar with the effort.

Pantry, which is run by Billy Hegeman, a senior manager in vendor management and consumables at Amazon, is currently set to launch in 2014, the people said on condition of anonymity. They did not want to be identified because Amazon's plans are still private.

Amazon spokesman Scott Stanzel declined to comment Thursday afternoon.

The service will be targeted at existing members of Amazon's Prime shipping program. It will launch with about 2,000 products typically found in the center of grocery stores, such as cleaning supplies, kitchen paper rolls, canned goods like pet food, dry grocery items like cereal and some beverages.

Amazon will let Prime shoppers put as many of these items into a set sized box, up to a specific weight limit. If the products fit and they don't exceed the maximum weight, Amazon will ship the box for a small fee.

Pantry will put Amazon into much closer competition with Costco and Sam's Club, which specialize in selling a limited number of items in huge volume at very low prices, according to retail industry experts.

"Amazon has the clubs in their cross hairs," said Keith Anderson, who leads RetailNet Group's Digital Advisory practice."This will be a potential issue for Costco."