Amazon (AMZN) Plans First Expansion of Grocery Initiative; Investors are Nervous
Tweet
Share
E-mail
Get Alerts AMZN Hot Sheet
Join SI Premium – FREE
You can stream videos, buy music, get home furnishings, and...have fresh produce delivered from Amazon.com (Nasdaq: AMZN)?
Not yet, but a five-year project is coming to a head and it could upend one of the only consumer segments not yet dominated by major e-commerce players.
Having tested its AmazonFresh initiative in Seattle for a number of years, Amazon is looking to roll out the service outside its home market for the first time. Reuters noted Tuesday that the first market selected for testing would be Los Angeles, California. The San Francisco Bay Area would be the second market later on this year and, if those go well, Amazon could hit another 20 markets in 2014.
Generally, groceries have been a loss-leading category and Amazon might be betting that consumers will order other goods along with the groceries.
Should Amazon be successful, more companies that just Kroger (NYSE: KR), Safeway (NYSE: SWY), Wal-mart (NYSE: WMT), and other retailers would be in trouble. Reuters notes that an Amazon-run fleet of delivery trucks could have negative implications on FedEx (NYSE: FDX), United Parcel (NYSE: UPS), and other package delivery services.
Shares of Amazon are down 0.9 percent Tuesday.
Not yet, but a five-year project is coming to a head and it could upend one of the only consumer segments not yet dominated by major e-commerce players.
Having tested its AmazonFresh initiative in Seattle for a number of years, Amazon is looking to roll out the service outside its home market for the first time. Reuters noted Tuesday that the first market selected for testing would be Los Angeles, California. The San Francisco Bay Area would be the second market later on this year and, if those go well, Amazon could hit another 20 markets in 2014.
Generally, groceries have been a loss-leading category and Amazon might be betting that consumers will order other goods along with the groceries.
Should Amazon be successful, more companies that just Kroger (NYSE: KR), Safeway (NYSE: SWY), Wal-mart (NYSE: WMT), and other retailers would be in trouble. Reuters notes that an Amazon-run fleet of delivery trucks could have negative implications on FedEx (NYSE: FDX), United Parcel (NYSE: UPS), and other package delivery services.
Shares of Amazon are down 0.9 percent Tuesday.
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- Active options: WMT AMZN MU BULL WULF AMD MARA BABA COIN SOFI GOOGL PLTR QXO
- Piper remains bullish on this beverage stock, citing 'best-in-class execution'
- Prime Video to invest $2 billion in Latin America by 2030
Create E-mail Alert Related Categories
Insiders' BlogSign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!
