Amazon may have started out as an online bookseller but the Seattle-based company has quickly evolved into the world's largest online retailer. And now Amazon is looking to take over the online grocery business.
According to a Reuters report, Amazon is "planning a major roll-out of an online grocery business that it has been quietly developing for years."
Amazon (AMZN) has been experimenting with grocery delivery service AmazonFresh in the Seattle area for more than five years, and could expand it to Los Angeles as early as this week and San Francisco later this year, according to Reuters. If those launches go well, AmazonFresh could begin in 20 other urban areas in 2014, both in the United States and internationally.
The potential expansion plan became a hot topic among traders on StockTwits.
Amazon may be king of e-commerce, but delivering groceries could prove to be a tougher business to penetrate since profit margins on food are low. But Reuters pointed out that Amazon could compensate by delivering high-margin products like electronics at the same time.
Amazon rival Wal-Mart (WMT) has been testing its fresh grocery delivery service, Walmart To Go, in the San Francisco Bay area for more than two years.
Amazon was also drawing attention for making its debut in India Wednesday. The company is beginning by selling books, movies and TV show video products, and will begin including mobile phones and cameras in the coming weeks.
The new agreement will bring hundreds of TV shows to its Prime instant video service, including children's programming like Dora the Explorer, SpongeBob SquarePants and Blue's Clues, as well as MTV and Comedy Central hits like Awkward and Tosh.o.
Netflix (NFLX) allowed its deal with Viacom to expire last month.
Safeway's (SWY) stock looks unsafe at any speed today. It's down more than 15% after the company reported quarterly results.
Supermarkets are notoriously challenging businesses. Take Whole Foods (WFM) out of the equation and nearly every grocery store struggles to generate healthy profit margins. Competition is tight within the industry, and then there's Wal-Mart (WMT). The big box retailer wants to eat every supermarket's lunch, dinner and breakfast.
Safeway's sales dipped during the latest quarter MOREMaureen Farrell - Apr 25, 2013 2:38 PM ET
Some Wal-Mart workers have been protesting against the giant retailer's labor practices this week. And several employees from around the country descended on Wal-Mart's headquarters in Bentonville, Ark. Wednesday to stage a rally while executives were holding their annual investor day meeting with analysts.
But Wall Street doesn't seem too concerned by the latest bad press. Wal-Mart (WMT) shares were up more than 3% Wednesday afternoon, hitting an all-time high in MOREPaul R. La Monica - Oct 10, 2012 12:58 PM ET
The opinions expressed in this commentary are solely those of Paul R. La Monica. Other than Time Warner, the parent of CNNMoney, and Abbott Laboratories, La Monica does not own positions in any individual stocks.
I love Amazon.com. Fantastic customer service. Prices are great. And as an avid reader who still likes physical copies of books (call me a Luddite if you must), the free shipping that comes with being an MOREPaul R. La Monica - Sep 6, 2012 3:40 PM ET
The annual Macy's 4th of July fireworks show in New York City provided the usual oohs and ahhs. But the pyrotechnics were quickly replaced by a dud of a June sales report from Macy's Thursday morning.
Macy's (M) said that sales at stores open at least a year, the most widely watched measure of health in retailing, were up just 1.2% from a year ago. Analysts were expecting so-called same-store sales MOREPaul R. La Monica - Jul 5, 2012 12:24 PM ET
Not a member yet?Sign up now for a free account
|ID'ing alleged Bitcoin creator leads to L.A. car chase|
|Albertsons to merge with Safeway|
|Russia already paying price for Ukraine|
|Wal-Mart slashes iPhone prices|
|China has first corporate bond default by solar firm|