November 14, 2017

These Are the Industries Amazon Could Destroy Next

Tech DC November 14, 2017

Tech giant Amazon, known for disrupting the traditional retail and consumer goods market, is not quite finished putting local, family-owned businesses out of their misery.

A new report, compiled by Sanford C. Bernstein analyst Ali Dibadj, states that restaurants, transportation services, and even the health care industry could be the next targets of Amazon’s wrath.

1. Consumer packaged goods: “We think beverages/snacks companies will fare better than household & personal care companies, while packaged food companies are likely most at risk.”

2. Restaurants: “The benefits of a potential national delivery network through Amazon Restaurants outweighs the relatively modest risk presented by Amazon’s placing possible downward pressure on food prices (proteins appear more insulated).”

3. Transportation: “Structural volume growth in e-commerce will benefit the network carriers, and the significant hurdle posed by the costs of last mile delivery is likely to result in better pricing.”

4. Broadline retailers: “We think the scale of Walmart’s existing network of distribution centers, stores, and new pick-up points we expect … will allow them to adapt well to the higher costs, while smaller grocers will be more damaged.”

5. Specialty apparel retail: “We see the off-price retailers retaining their competitive advantage in apparel, for now.”

6. Healthcare services: “We think Amazon’s entry into pharmacy would be negative for independent pharmacies, somewhat negative for national pharmacies and distributors, and we increasingly see this as long term negative for” pharmacy benefit managers.

“The only thing one can be certain about is that things will change and companies will be disrupted, and when it comes to disruption there has never been a company quite like Amazon,” Dibadj wrote.

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