With the government approving Amazon’s proposed $500 million investment in the sector, the floodgates of the food retail sector seem to have been thrown open. Most analysts believe that after e-commerce, the food retail sector will be the next big space which is a low-hanging fruit say some. They expect the sector to see a few new entrants and consolidation to heat up further.
“Amazon has a huge advantage with an end-to-end supply chain. Be it procurement or online delivery, none of the other players in the food sector stand a chance against Amazon,” says Sanchit Gogia, Chief Analyst and CEO of Greyhound Research.
After acquiring US-based Whole Foods Market Inc in early February 2017 for $13.7 billion and having a firm footprint in the brick and mortar space in the US, it was natural for Amazon to secure its presence similarly in India. Amazon can unleash its potential in the food retail sector in India. It has been big on procurement unlike Big Basket which does not have the buying power of the former, said Gogia.
“Amazon can spend money on online footfalls and has the ability to get amazing prices from the back-end as they are big on procurement,” he said.
If there is a competition that can match up to Amazon, then it is Walmart, says Gogia. However, Amazon has a head start in India compared with Walmart which does not have an online presence like the former. Walmart has a major procurement advantage in India but that is restricted to the B2B sector.
Copyright © 2017 Greyhound Research. All rights reserved. You may share this research note using the options made available. Please don’t copy this research note (complete or parts) and distribute over the web and emails. Connect with us if you need clarifications.
Have a question on this or other technology and innovation topics? Wish to understand what this means for your business? Click here to engage with a Greyhound Research Analyst.
Like this insight? Sign up for our newsletter to get our latest insights.
Wish to read more such Insights That Inspire? Access scores of other Free, Freemium and Premium Insights from the menu above.
Sanchit Vir Gogia: Sanchit is the Chief Futurist, Founder & CEO of Greyhound Knowledge Group, a Global Strategy & Transformation Research, Advisory & Consulting Group. He also serves as Chief Analyst & CEO of Greyhound Research, a Global, Award-Winning, Independent Technology & Innovation Research, Advisory & Consulting firm. To read more about him, click here.
Note for IT Decision Makers – Join Our Exclusive Community! Greyhound Research values your opinion and invites IT Decision Makers and Business Leaders involved in IT projects to join our exclusive, invite-only Greyhound Golden Gate (GQube) Councils. If your project is exclusive and we have your permission, we will write a research note about you and share it with the larger community. Over and beyond, this also gives you access to some of our thought-leading research and analysts. Please write to us on email@example.com and we’ll take it further from there!
Note for IT Vendors, Telecom Operators and Channel Partners – Did you see our Research Agenda? We have organised all of our insights in a way that allows you to better filter and read what works best for you. Please write to us on firstname.lastname@example.org and we’ll gladly share a copy of the research agenda with you.