The rollout of supercenters at Walmart (WMT) stores across the U.S. was ending in 2000 as Amazon (AMZ) was simultaneously starting to nibble on WMT’s consumer whole goods sales. WMT’s subsequent 17-year response has been a slow, poor, expensive imitation. Walmart supercenters and Amazon’s online inventory have competed for nearly two decades, but is that WMT’s best strategy?

WMT can’t catch up. But, they do show signs of shifting their online capabilities to possibly digitally improve their core customers’ in-store shopping experience.

WMT’s Profit Core

A WMT supercenter stocks roughly 100,000 of the most popular consumer items. The top 7,000 SKUs by sales account for 70% of all sales. These SKUs all pass through WMT’s cross-docking centers. The daily delivery of these items to stores enables 99% fill rates with no excess inventory at everyday low prices. Customers go to WMT to load up on these consumables and buy other things they need. The bottom 80% of U.S. households, by income, can’t afford not to shop at WMT. These items and these customers are WMT’s profit core (times 4,200 stores in the U.S.). Continue reading 65. Amazon Business Series: Amazon v. Walmart, Part 4 →

Parts 1 and 2 of this blog series looked at Grainger’s profit woes and new ways to assess the Amazon Business challenge to all distributors. Now Amazon competes with auto parts retailers for business. Using part 2 guidelines, what would you advise auto parts retailers to do?

Amazon Competes With Auto Parts Retailers for Business

Do the Auto Parts Retailers Have a Problem? In January, Amazon (AMZ) signed more direct-buy agreements with aftermarket auto parts makers. The stock prices of the Big Four retailers (Genuine Parts, O’Reilly’s, AutoZone, and Advanced Auto) took a hit. But in April, stock analyst reports claimed that the fears were overblown, that Amazon couldn’t put a dent in the Big Four’s moats, and that the stocks were now a bargain.

Continue reading 64. Amazon Business Series: Auto Parts Retailers v. Amazon, Part 3 →