This week in the news, Spanish retailer Zara seeks to expand market share in China by opening an online store on Tmall, tech giant Amazon plans to close one of its oldest facilities in Kansas, and Walmart recently unveiled its new pickup grocery service, which is aimed at bridging the digital and physical retail worlds.
- Zara to Open Online Store on Tmall
To gain a stronger foothold in China, Spanish retailer Zara plans to open an online store on Tmall, a Chinese website owned by Alibaba, where companies such as Nike Inc., Burberry Group Plc and The Gap Inc. sell their products. Tmall, which outranks Amazon.com as China’s biggest e-store, takes a 0.5 percent to 5 percent commission on sales made on the site. “Retailers are deciding to launch through Tmall because of the breadth of its audience,” said Jamie Merriman, an analyst at Sanford C. Bernstein & Co. “It’s not a question so much about profitability as it is about the potential to expand market share.” (Bloomberg)
- Amazon to close distribution plant in Kansas
Retail giant Amazon said it plans to close a distribution center in Coffeyville, Kansas in February 2015. Wedbush Securities analyst Michael Pachter said the retailer has reached deals with California, Texas, Pennsylvania and New York in which it would receive tax breaks for a limited period of time in exchange for building distribution centers and employing people in those states. “Locating a distribution center in Kansas didn’t make sense from a business perspective because you have a low population, but it made sense from a tax perspective,” Pachter said. “Once you neutralize the tax law, they didn’t need to be there anymore—that is what happened.” (TheTandD.com)
- Walmart Opens its Pickup Grocery Format in Northwest Arkansas
Walmart customers in Northwest Arkansas can now order their groceries online and pick them up in as little as two hours – without ever leaving their car. Former Walmart U.S. CEO BIll Simon first announced the plans for a drive-up grocery depot in March. Registered shoppers can order from the online site, which contains roughly 10,000 grocery and consumable items including meat, dairy, produce and common household products. The consumer then drives to one of the kiosk stations at the pickup grocery site at a scheduled time and notifies the attendant who will bring their order to the car. (The City Wire)
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I wish Walmart the best. Grocery pickup services don’t usually fare too well. Are they exploring a strategy to do things differently?
Hi Mbolton1,
Walmart seems to be taking a slightly different tack by using the grocery pickup service as more of a way to promote their online platform. Additionally, the pickup kiosks they’re using seem to make the experience incredibly painless for shoppers, though whether service will be fast enough is yet to be seen.