In my post from yesterday, I mentioned how Amazon (AMZN) has changed the spectrum of retail. I have to ask if brick and mortar stores have much of a future. Well, some do, most don’t. That’s how I see it. If I were to advise a new retailer, I’d tell them to first concentrate on your online store, then the storefront.
I came upon an article about Amazon and their need for brick and mortar operations by Michael Wiggins De Oliveira. He brings up Amazon’s acquisition of Whole Foods and the need for brick and mortar services.
Retail stocks have been clobbered except for Wal-Mart (WMT) and Abercrombie and Fitch (ANF). There have been a few other names to escape the retail bear trap, but you get the idea. The author questions the current definition of the retail basket. He urges to look at particular names and go from there. I tend to agree. One method is to really look at earnings.
A long-term retail shopping shift is underway. Oftentimes I get the feeling it’s like a snowball rolling down a mountain. The consensus of the author is that there’s a place for retail stores. For a local store to survive, they need a “twist” to gain attention and make sales. And don’t forget the online portion of the operation.
There can be no doubt that Amazon sees brick and mortar as being profitable. Just how profitable is another item.
Source: (December 2017) Amazon Needs Brick And Mortar Retail; But Shareholders Will Not Benefit