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Amazon Isn’t Killing Brick-and-Mortar Retail. It’s Showing Other Retailers How to Do It

If you ask most people operating in the real estate market, they tell you that retail is at risk. The latest data shows commercial real estate retail deals are slumping, because Amazon is fundamentally changing the retail industry and pushing people online.

The facts, however, are decidedly different, as Black Friday, Small Business Saturday, Super Sunday, and now Cyber Monday reveal.

Over the weekend, Adobe released its findings on U.S. retail spending over the past few days. It showed a clear consumer desire for online shopping (Black Friday online sales reached a record $7.4 billion, for instance). The study also found that mobile purchases accounted for 39 percent of all e-commerce sales–a 21 percent jump compared with last year.

At first blush, that might seem like brick-and-mortar retailers suffered. In truth, they benefited from an increasingly important phenomenon in which people buy online but pick up their orders in stores.

According to Adobe’s data, so-called BOPIS (Buy Online, Pickup In Store) purchases were up a whopping 43.2 percent year over year. It was a clear “sign that retailers are successfully bridging online and offline retail operations,” Adobe said.

In other words, brick-and-mortar retailers have found a way to bolster their offline businesses. Target and Best Buy have been among the most successful at it. During its fiscal third quarter ended November 2, for instance, Best Buy reported revenue of $9.8 billion, beating Wall Street’s expectations. Its growth came from a mix of online and offline sales.

But perhaps nowhere is the evidence of Amazon not killing brick-and-mortar stronger than in a quick evaluation of Amazon itself.

While the company still generates the lion’s share of its retail business online, it’s increasingly focusing its efforts in brick-and-mortar.

In 2017, Amazon announced plans to buy Whole Foods for $13.4 billion. Now, two years later, Amazon is only expanding its investment in the company and ramping up its delivery options to make it a more attractive option for shoppers.

Meanwhile, ​the company’s cashierless stores, Amazon Go,are growing in number and size. Amazon is placing more of them across the U.S., with plans to dramatically expand their footprint over the next few years. The company is also planning to open bigger Amazon Go stores that could be the size of supermarkets.

Perhaps most important to competing retailers, Amazon has also signaled a willingness to license its cashierless technology to competitors.

All of that should be making retailers ask themselves a very important question: If Amazon is the company that’s destroying brick-and-mortar retail, why is it also the company moving so aggressively toward it?

The fact is, brick-and-mortar retail still offers plenty of value to consumers, especially in food products, grocery stores, and convenience and service locations that can’t be easily replaced by Amazon. Even in areas where Amazon could replace the retailer (think electronics), companies like Best Buy and Walmart, among others, are doing well.

There’s no debating the future of shopping will still be dominated by e-commerce, but predicting the demise of offline shopping is ludicrous. And judging by its latest moves, no one knows that better than Amazon.

By Don ReisingerTechnology and business writer

Source: Amazon Isn’t Killing Brick-and-Mortar Retail. It’s Showing Other Retailers How to Do It

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Every year, Amazon and other retailers end up with billions of pounds of excess, unsold inventory that they’re sending straight to landfills, or incinerating. Returns in the U.S. create more than 5 billion pounds of waste in landfills each year, and more than 15 million metric tons of carbon dioxide. The problem is only growing as Amazon leads the way in bringing more shoppers online, where the rate of returns is 25%, compared to just 9% for in-store purchases. Now, the e-commerce giant and other tech companies and retailers are increasing donation efforts and using data and A.I. to cut back on the wasted inventory clogging our landfills and our planet. » Subscribe to CNBC: https://cnb.cx/SubscribeCNBC » Subscribe to CNBC TV: https://cnb.cx/SubscribeCNBCtelevision » Subscribe to CNBC Classic: https://cnb.cx/SubscribeCNBCclassic About CNBC: From ‘Wall Street’ to ‘Main Street’ to award winning original documentaries and Reality TV series, CNBC has you covered. Experience special sneak peeks of your favorite shows, exclusive video and more. Connect with CNBC News Online Get the latest news: https://www.cnbc.com/ Follow CNBC on LinkedIn: https://cnb.cx/LinkedInCNBC Follow CNBC News on Facebook: https://cnb.cx/LikeCNBC Follow CNBC News on Twitter: https://cnb.cx/FollowCNBC Follow CNBC News on Instagram: https://cnb.cx/InstagramCNBC #CNBC What Retailers Like Amazon Do With Unsold Inventory

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Amazon Is Planning to Disrupt the Supermarket Business & It Won’t Need Cashiers to Do It

Amazon has disrupted plenty of industries over the past several years, but now it may be taking the fight to your local supermarket.

The tech giant is planning to expand its Amazon Go cashierless stores to more cities and with bigger footprints next year, Bloomberg reported on Wednesday, citing sources who claim to have knowledge of its plans. Amazon will initially open stores between 2,000 and 10,000 square feet, or about the size of a convenience store or small market. But before long, the company plans to open 30,000-square-foot supermarkets with the same cashierless technology.

The first Amazon Go store opened in Seattle in 2016, and the company has been slowly expanding to other cities. The stores are stocked with products customers want, but don’t have any cashiers. Instead, customers walk into the store and scan their phones to alert the system that they’re there. They then choose the products they want and walk out. Amazon’s cameras, sensors, and other technologies identify what shoppers have selected and automatically charge their accounts.

Still, the existing stores are small, allowing Amazon to more easily track customers and ensure no one is walking out with free goods. According to the Bloomberg report, Amazon has now improved the technology to a degree that it believes Amazon Go could be applied to stores measuring 30,000 square feet, or about the same size as your local supermarket.

That’s undoubtedly bad news for a grocery store industry that’s dealing with pressure from all sides. A McKinsey study published last year found that while the global grocery industry is $5.7 billion and growing, grocery stores have been hit hard by higher costs and more competition for consumer dollars. Online shopping has also prompted many consumers to turn away from grocery stores, applying even more pressure on the companies.

But Amazon might be uniquely positioned to capitalize on that. The company has a massive online store, with enough reach (and cash) to attract shoppers and not worry about short-term losses.

Amazon Go stores have also been engineered to keep costs down. The technology they use is expensive, of course, but by not needing to keep its stores staffed with cashiers all day, Amazon can dramatically reduce costs. That puts even more pressure on competitors.

That said, Bloomberg also reported that Amazon could become a quasi-lifeline for the supermarkets and other retailers it plans to compete against. According to the report, the company is mulling the possibility of licensing its cashierless technology to other companies. In those cases, Amazon licensees can operate an Amazon Go store under their own brand and reduce their personnel costs.

For its part, Amazon has remained tightlipped on its plans. But Bloomberg’s sources say the company is serious about making a run at the supermarket industry. And if all goes well after testing larger stores in the first quarter, we can expect to see the first Amazon Go supermarkets pop up sometime in 2020.

By Don ReisingerTechnology and business writer

Source: Amazon Is Planning to Disrupt the Supermarket Business. And It Won’t Need Cashiers to Do It | Inc.com

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SupermarketGuru.com Editor Phil Lempert on reports Amazon is set to disrupt the supermarket industry with its own brick-and-mortar stores. FOX Business Network (FBN) is a financial news channel delivering real-time information across all platforms that impact both Main Street and Wall Street. Headquartered in New York — the business capital of the world — FBN launched in October 2007 and is the leading business network on television, topping CNBC in Business Day viewers for the second consecutive year. The network is available in more than 80 million homes in all markets across the United States. Owned by FOX, FBN has bureaus in Chicago, Los Angeles, Washington, D.C. and London. Subscribe to Fox Business! https://bit.ly/2D9Cdse Watch more Fox Business Video: https://video.foxbusiness.com Watch Fox Business Network Live: http://www.foxnewsgo.com/ Watch full episodes of FBN Primetime shows Lou Dobbs Tonight: https://video.foxbusiness.com/playlis… Trish Regan Primetime: https://video.foxbusiness.com/playlis… Kennedy: https://video.foxbusiness.com/playlis… Follow Fox Business on Facebook: https://www.facebook.com/FoxBusiness Follow Fox Business on Twitter: https://twitter.com/foxbusiness Follow Fox Business on Instagram: https://www.instagram.com/foxbusiness

Amazon Almost Killed Target. Then, Target Did the Impossible

In 2017, everyone was laughing at Target.

Sales had continued to slide. Stores were in disrepair. And company leaders were struggling to adapt to the changing behavior of consumers–many of whom were shopping more and more with online retailers like Amazon.

As fellow retailers Macy’s, J.C. Penney, and Gap collectively shuttered hundreds of stores because of similar struggles, analysts said Target should do the same.

But Target executives, led by CEO Brian Cornell, had a different idea. The key to revitalizing Target, they said, was to go on the offensive.

So, in March 2017, Target made a huge announcement: It planned to invest over $7 billion in a turnaround strategy that would include:

  • remodeling existing stores (and opening smaller ones in urban areas);
  • introducing new, private label brands; and,
  • enhancing its digital shopping experience.

Wall Street thought the plan was a disaster. On the day of the announcement, Target suffered its largest stock plunge in almost a decade.

But fast-forward to today, and Target is thriving. First-quarter results for 2019 beat analysts’ expectations. The store’s private-label lines are exploding. And as comparable store sales continue to rise, the stock price is trading at an all-time high.

How did Target do it?

A close look at the company’s brilliant turnaround strategy reveals some major lessons for businesses of any size.

Here are some highlights:

Think long term.

When Target announced its turnaround plan, Cornell expected backlash. He knew investors would hate the idea of stuttering profits for the foreseeable future.

But he held fast to his plan. “We’re investing in our business with a long-term view of years and decades, not months and quarters,” Cornell said at the time.

Cornell knew this reset was necessary because so many Target stores had fallen into disrepair over the years. And while the company was making efforts in e-commerce, it simply didn’t have the infrastructure to deliver.

Contrast that with today. Target has remodeled hundreds of stores, and it has built a hundred “mini-stores” in urban areas like New York and on college campuses (with plans to open dozens more of these every year for the foreseeable future). The company also invested heavily in its e-commerce operations to great benefit. (More on this in a minute.)

By focusing on the long-term health of the company instead of short-term financial performance, Cornell took a page out of Jeff Bezos’s playbook–and it clearly worked.

Leverage your strengths.

Target’s e-commerce infrastructure needed a complete revamp. But could the company really compete with Amazon and Walmart, which were years ahead of the curve?

It could–by doing things a little differently.

Target execs knew that as popular as e-commerce has become, the majority of retail shopping still takes place in physical stores–especially when it comes to clothing.

So Target chose to focus on a model that would maximize its strengths. Known as “ship-to-store,” Target’s e-commerce platform turns physical stores into mini warehouses for online customers. That makes it possible for customers to order a product online, and then pick it up in a store on the same day.

Ship-to-store reduces Target’s shipping and handling costs, and takes advantage of already existing space in physical stores. And if a customer decides to do some shopping while already there at Target, the benefit is two-fold.

Fill a gap.

Consumers had once affectionately referred to Target as “Tarzhay,” an ode to products and style that were affordable yet a step above those offered by competitors like Walmart. Over time, though, Target had created too many labels that were clear misses.

“Tarzhay” had lost its cachet.

But nobody had stepped up to fill that gap of stylish, exclusive clothing for lower prices. So, in an effort to rebuild its reputation, Target doubled down on its exclusive brands. The company has launched 20 private-label lines over the past three years, including brands for modern furniture, kids’ clothes, electronics, and home goods.

The investment paid off: Six of Target’s private-labels each do more than a billion dollars in annual sales. These labels, together with other brands sold exclusively at Target,  contribute nearly a third of the company’s overall revenue (and an even greater percentage of profits).

In addition, Target has worked hard to fill gaps left by unsuccessful competitors. For example, when stores like Toys “R” Us and the Sports Authority went bankrupt, Target saw this as opportunity: market share begging to be gobbled up.

Yes, Target has definitely gotten its groove back. It did so by bucking analysts’ advice, and instead returning to basics:

Thinking long-term. Leveraging strengths. Filling gaps.

I guess Target got the last laugh after all.

By: Justin Bariso Author, EQ Applied

Source: Amazon Almost Killed Target. Then, Target Did the Impossible

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FedEx Is Ending a Major Amazon Deal As Amazon Builds a Rival Shipping Network

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FedEx is snipping another tie with Amazon as the e-commerce giant emerges as a competitor by building its own shipping network. The ground-delivery contract with Amazon won’t be renewed when it expires at the end of this month, FedEx said in an emailed statement. The decision quickens the company’s retreat from the largest online retailer just two months after FedEx said its Express unit wouldn’t extend an agreement to fly Amazon’s packages in the U.S.

“This change is consistent with our strategy to focus on the broader e-commerce market,” FedEx said in the statement. Recent moves to bolster service “have us positioned extraordinarily well” to handle demand, it said. The courier will still have a contract with Amazon for international deliveries.

FedEx is reducing its dependence on Amazon as the online retailer builds out a logistics network with hundreds of fulfillment centers and adds next-day air capacity with leased jets. Amazon is also starting a home-delivery service modeled after the contractor-based ground unit at FedEx, which flagged the competitive risk in its latest annual report to U.S. regulators.

E-Commerce Deliveries

Amazon made up about 1.3% of FedEx’s sales last year. To scoop up more e-commerce business, FedEx announced in May that its ground unit would begin seven-day service in January, deliver more packages that had been handed off to the U.S. Postal Service and invest to handle oversized packages.

The Memphis, Tennessee-based company has also signed up more drop-off and pick-up points, including with Dollar General Corp. FedEx is even testing a ground-delivery robot.

Longtime rival United Parcel Service Inc., the largest U.S. courier, is taking a different tack by continuing its relationship with Amazon. Analysts have estimated that the retailer’s pledge to expand overnight deliveries fueled a 30% spike in UPS’s domestic next-day volume in the second quarter.

UPS hasn’t said how much revenue it generates from Amazon, but if the total were more than 10%, the courier would be obligated to disclose the information in regulatory filings. The amount is probably close to that threshold, according to analyst estimates.

Profit Pressure

The surge in e-commerce business has been a double-edged sword for FedEx and UPS by spurring sales growth while squeezing profit margins, since home-deliveries are more costly to handle than dropoffs at commercial customers.

In June, FedEx said it was in a “transition year” as it seeks to drive down costs and fix an ailing European business. The company forecast a mid single-digit percentage drop in earnings for the current fiscal year, which ends in May.

By Thomas Black / Bloomberg

Source: https://time.com

Jeff Bezos Unveils Blue Origin’s Lunar Lander; Announces Launch Of Next-Gen Rocket In 2021

Amazon founder Jeff Bezos confirmed that his space company, Blue Origin, will launch its next-generation rocket, New Glenn, for the first time in 2021, and also hinted that his company might be capable of helping NASA put humans on the Moon within the Trump administration’s stated five-year time frame.

“We can help meet that time line,” he said. “But only because we started three years ago. It’s time to go back to the Moon—this time to stay.”

Leading up to this dramatic announcement on Thursday at the Washington Convention Center, Bezos couched his vision for his space company in the context of the problems of the world as he sees them. Within the next couple of hundred years, Earth will run out of resources necessary for people to live comfortably, Bezos predicted. Which is why, he says, humanity needs to move into space.

To that end, Bezos revealed Blue Origin’s next-generation rocket, New Glenn, which will begin operations in 2021. New Glenn would be a “heavy lift” rocket, competitive with SpaceX’s Falcon Heavy rocket, as well as United Launch Alliance’s Delta IV and in-development Vulcan rocket. According to Bezos, New Glenn will reduce costs by having a first stage that can be reused 25 times and use liquid natural gas as a propellant. Though he did not reveal any pricing information about the rocket, he did mention that the fuel costs per launch would be less than $1 million.

And one of the things that rocket may launch? One of the answers came immediately as Bezos—to great fanfare—showed off a large mock-up of the company’s proposed Blue Moon lunar lander. According to Bezos, the lander will use liquid hydrogen as fuel—just as the company’s New Shepard rocket does today. It will be capable of landing autonomously and be equipped with cameras, lidar and other sensors to map terrain. It will also be configurable in order to handle a variety of missions such as carrying a rover—or humans—to the surface.

Again, there wasn’t any information provided about how much it will cost for a company to buy a mission on the Blue Moon. However, Bezos did reveal that Blue Origin already has customers.

“We already have a bunch of customers for Blue Moon, some of whom are in the audience,” he said. “They’re going to be deploying science missions to the Moon as well.”

Bezos couched these product announcements in the context of his vision for the future, which for him means humanity migrating out to O’Neill habitats–gigantic, miles-long space stations envisioned by physicist Gerard O’Neill in the 1970s, are where humans will live and work comfortably, and conduct heavy industry, Bezos said.  This will leave Earth “zoned for residential and light industry,” he said.

Building grandiose habitats—or even more relatively modest goals like any kind of permanent settlement in space or on the Moon—is not the job of this generation, but the next, according to Bezos. He sees his goal as building the infrastructure necessary for it to happen. “It’s this generation’s job to build that road to space so future generations can release their creativity,” he said.

The company also released a promo video for its lander, which you can view below.

Read more: Jeff Bezos And Elon Musk Want To Go To The Moon—They Just Disagree On How To Get There

Follow me on Twitter or Facebook. Read my Forbes blog here.

I’m an Associate Editor covering science and cutting edge tech.

Source: Jeff Bezos Unveils Blue Origin’s Lunar Lander; Announces Launch Of Next-Gen Rocket In 2021

Walmart And Target Are A Step Ahead Of Amazon

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Traditional brick and mortar retailers Walmart and Target are a step ahead of Amazon in the delivery battleground: while Amazon is offering 1-day delivery Walmart and Target are already moving to same-day.

That’s according to retail equity analyst John Zolidis.

“It may be tempting to think that Amazon investing $800 million to move its Prime offer of 2-day shipping to 1-day delivery will put incremental pressure on large retailers,” he says.  “However, this move is not a surprise.  We spoke with Wal-Mart (WMT) CEO Doug McMillon about this in October last year. He told us that same-day delivery, not 1-day delivery, was going to be the real battleground.”

McMillon is right. As was discussed in a previous piece here something has changed in the retailing industry in recent years.

Instead of fading away into the archives of history, brick and mortar retailing has come back to complement and support on-line retailing. Shoppers are placing orders online and are picking up merchandise at neighborhood stores, saving time and avoiding shipping fees.

That’s especially the case for groceries, where speed of delivery is a crucial factor in maintaining freshness.

The merging of online retailing with traditional retailing has provided an advantage to retailers with extensive neighborhood store presence like Walmart and Target. “Both WMT and Target (TGT) are already at a huge advantage over AMZN in this respect — because both retailers already have product stored within a short driving distance of the vast majority of the U.S. population in their respective 1,000’s of stores,” notes Zolidis. “Further, both retailers are offering not just delivery (Target already has same-day delivery via Shipt) but various options for BOPIS (buy online pickup in store).

Amazon, Walmart, and Target Shares YTD

Amazon, Walmart, and Target Shares YTD

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Then there are pick up points to enhance convenience. “WMT now has pickup towers in-store and are installing these across the chain, and it has established drive-through pick-up grocery lanes and is continuing to add these at a rapid pace,” adds Zolidis.  “Target is offering similar services and installing dedicated counters for customers to more conveniently grab items on the way home from work or after picking up kids from school. Target will also bring pre-ordered items out to your car in the parking lot.”

The strategy has been paying off. The two retailers have reported a rebound in both online sales and retail sales in recent quarters.

Simply put, Walmart and Target have changed the game in the retailing industry. And they have brought Amazon back into the world of the neighborhood store it once sought to eliminate by acquiring traditional retailers like Whole Foods — and by planning to open more grocery stores around the country to cater to markets not served by Whole Foods, as recently announced.

That’s why Zolidis thinks that investors would be making a mistake selling Walmarts and Target’s shares at this point.

“In our opinion,” he concludes, “it would be a mistake to sell large retailers on this announcement (WMT & TGT) as they have anticipated this for some time and are already rolling-out corresponding services.”

My recent book The Ten Golden Rules Of Leadership is published  by AMACOM, and can be found here. 

I’m Professor and Chair of the Department of Economics at LIU Post in New York. I also teach at Columbia University.

Source: Walmart And Target Are A Step Ahead Of Amazon

Discover Thousands of Profitable Amazon Products in Minutes with this New Fast & Easy to Use Software

ZonASINHunter can download multiple Amazon pages at once using a technology called Parallel Processing, means this software downloads pages using multiple internet connections. That explains why ZonASINHunter gives faster results. The downloading speed is also faster because there are no opened browsers and gets compressed data, which means less memory to use. Plus, you can get more complete product informaton so you can really pick the best products! Here are some plus points of ZonASINHunter compared to other asin code lookup software…..

Source: https://zonasinhunter.com/

 

DoorDash And Amazon Won’t Change Tipping Policy After Instacart Controversy; If You’re Worried, Carry Cash

The tipping controversy that prompted Instacart to reverse a compensation plan to its contract workers isn’t likely to go away: Rivals DoorDash and Amazon Flex are continuing to adjust driver pay based on how much they get tipped, saying doing so ensures a minimum payout. The practice, which has its roots in the way brick-and-mortar restaurants pay waitstaff, has been adapted to suit the needs of app-based delivery companies…………

Source: DoorDash And Amazon Won’t Change Tipping Policy After Instacart Controversy; If You’re Worried, Carry Cash

Why Jeff Bezos’ Divorce Could be Bullish for Amazon Shares

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News of Amazon chief Jeff Bezos and wife MacKenzie Bezos divorcing sparked questions about how the split could affect the world’s most valuable company’s stock. While there were questions, there wasn’t panic. Investors are in wait-and-see mode. The news, which came Wednesday via a tweet from Jeff Bezos, barely moved Amazon’s share price. It closed Friday at $1,640.56……..

Source: Why Jeff Bezos’ Divorce Could be Bullish for Amazon Shares

Amazon Becomes World’s Most Valuable Company for the First Time Ever With a Market Value of $797billion – Surpassing Microsoft — BCNN1 WP

Amazon has become the world’s most valuable company for the first time, surpassing Microsoft. The shift occurred Monday after Amazon’s shares rose 3 per cent to close at $1,629.51 and lifted the e-commerce leader’s market value to $797billion. Meanwhile, Microsoft’s stock edged up by less than 1 percent to finish at $102.06, leaving the computer […]

via Amazon Becomes World’s Most Valuable Company for the First Time Ever With a Market Value of $797billion – Surpassing Microsoft — BCNN1 WP

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