London Amazon Inc. is a company that is expanding daily with an aim of providing the best services for those people who need them within the whole of UK. They have started the same day delivery service for the residents who need items such as cheese and butter. This move will have an impact on the online retailer after its launch into the widely expected to launch in the market for those people who need it within the country.
The company is already offering many nonperishable products such as toilet paper, water, diapers and coffee especially to prime service members in London and Birmingham. After the launch, the company will start expanding its operations to many small cities in the neighborhoods.
Just a few weeks in Seattle when Amazon Flex started an online retailer that allows the local companies to merchandise to the homes of their customers using a chain of network that is independent of contractors. This move will be similar to the on-demand services started by Uber Technologies Inc. a couple of years ago.
Research by Institute for Grocery Distribution has shown that online grocery shopping in UK accounts for up to 5 percent of the grocery market in the UK today. In addition, the growth is expected to reach 8.6% by the year 2020. This will bring a business opportunity especially for those people who need them within the UK market.
Most of the U.K. media have been reporting for months that Amazon reported a net loss of $241 million despite having $89 billion in their sales. By launching a new online grocery that offers an alternative option, it would enable the company to work hard to redeem themselves given the growing competition in the market. For instance, in U.S., Amazon often sell many perishable groceries via Fresh grocery delivery service that provides things like meat, ice cream, fresh fruit and even milk in some cities.
At the moment, Amazon hasn’t disclosed plans of launching Fresh in the European market (U.K.), after the company beginning looking for more staff in the grocery retail area. In the beginning of the month, Amazon started advertising for the position of senior vendor manager based in London with an aim of making sure that they build their reputation within the UK market.
If Amazon can launch this full-fledged grocery in Britain, it would bring competition to higher levels since it would compete with the other 4 largest grocery chains in the country. In addition, it would offer a home-delivery service that allow click and collect after buying online. With the Amazon’s entry, the market is expected to be competitors especially for those people who need to buy from the market. This will also have an effect on the prices since it will lower the prices way down for the buyers.
Now, Amazon is trying to focus on an immediate delivery solution as opposed to offering a broad grocery. Until Amazon bring something special in the market, this new grocery would be an amazing way to bring their branded products in the market to provide buyers a wide range of options that they can choose when looking for quality products according to John Kershaw who is Exane BNP Paribas analyst.
Just like Amazon Fresh, which is available in California, Seattle, and New York, they will be moving a step closer to provide quality in the UK for the buyers to taste what they offer. Last year, Amazon sold their products in over 200,000 groceries ranging from air freshener to biscuits and coffee through their UK website. The US Amazon Fresh also provides vegetables, meat, fresh fruit, and dairy products with the ability to fulfil orders by free same-day delivery for only $35.The arrival of Serviin in the UK will bring many challenges to the British supermarkets that are already struggling to cope with the ever-rising competition from discounters the Aldi and Lidl. In the end, some of them will have to close if they cannot cope up with the fast growing level of competition.
Internet has provided a new avenue for sales with about 6 percent of all groceries are now selling online in the UK. With the trend, the predicted grocery sales through internet will tipple in the next three years to reach 8 percent of the total grocery sales in the UK. Those market players, who need to take part in the competition, must know ways of ensuring that they improve their internet performance especially when looking for ways to gain a market share in the UK.
In the UK, Amazon will face far stronger competition on these groceries when compared to US as Tesco, Sainsburys, Asda, and Morrisons have personal online grocery services. This will make the industry competitive and nice to watch according to the prediction of many online business analysts.