How Amazon Is Bankrupting Many Companies?
The tech giant, Amazon, is said to have been bankrupting many companies due its monopoly across the world. However, if we carefully scrutinize all those companies that were bankrupted while coming in way of Amazon, we’ll get to know how they were basically destroyed by their own leadership and managerial issues. It’s true that Amazon played a major role in eradicating many companies from its way, but it’s what every company does basically. It’s the natural phenomenon. Furthermore, we’ll discuss the 5 companies that went or are in serious trouble due to Amazon entering the market.
1. Target
Target was serious disturbed when Amazon acquired Whole Foods back in 2017. The stock price of target were in serious trouble and it was on its knees against the top-notch organizations – Amazon and Wallmart.
To tackle the falling market share, Target introduced the next day delivery service and added various other categories and items to its stores. The counter proved to be somewhat lucrative for target, luckily it was saved from getting lost in the shadow of the tech giant, Amazon.
2. Foot Locker
It is also one of the many companies severely affected by Amazon’s prevalence across the world. Last year in the Q1 the company’s revenue had fallen to 17% in a day due to similar products available at various stores across the internet. At the same time, the huge earning product of Foot Locker, Nike also switched ways to Amazon and began selling at the online store where it is said to have increased its overall earnings.
This was the huge blow to the Foot locker and many other small companies working under it. What’s more, in June 2018, the stock price of Foot Locker had fallen down to 29% from 78.81 in Jan 2018. The company suffered a huge loss while having to forcibly close its 110 outlets.
3. Etsy
Etsy is a boutique brand and an obvious target of Amazon in hand made products. Amazon launched its hand made products back in 2015 and with the continuous rising in sales, the Etsy was ultimately targeted by Amazon in the long run. With few exceptions, Etsy however continued with good earnings for a short period, but then a nightmare happened following to Supreme Court ruling.
Supreme Court stated that the states can now collect sales tax from online marketplaces. The ruling did not much hurt Amazon as it did Etsy, which was on its knees against the tech giant, Amazon. Because Amazon was already collecting the sales tax from its third party seller, the ruling didn’t affect much to the company, However, Etsy was severely affected following to decline in overall revenues.
4. Payless
The company went bankrupt in April 2017 following to the arrival of a number of online stores, mainly Amazon which had severely outranked most of the online stores. The stores traffic in the Mall and everywhere else went to decline and people gradually got used to of buying online rather than walking into a mall or any other store. Also, the reason behind bankruptcy was not only the hassle free shopping but also the online stores charged less or equal in comparison to traditional malls or stores that usually charge a lot more than actual price.
5. Best Buy
It is one of the few companies across the world that has been standing strong against Amazon, which of course have drastically been increasing its growth rate, but Best Buy does not seem to be an easy rival. Against the popular Amazon, Best buy is working hard to bring up unique offering products. With only few percentage in overall growth rate, Best Buy is terribly competing with Amazon whose sales rose to 28% in 2015. Unluckily, Amazon couldn’t completely destroy the Best Buy but still it put a severe dent on its earning potential and overall revenue.
At the last, Amazon has recently entered the Pakistani market by acquiring Daraz.pk which is said to be the Pakistan’s no. 1 online marketplace. The toughest rivals it will be facing in Pakistan are Telemart and Homeshopping. Let’s see how the rivals react to the tech giant Amazon.
Let us know in the comment section what are some more companies that Amazon could compete with?
you conveniently forgot to mention that all those companies paid huge rents, rates, taxes, while amazon gets to take advantage of not having to pay any of that - in the uk its tax bill was miniscule, despite having massively raised profits.
it's a lot easier to wipe out the competition when the revenue office is your friend.
you're not really that naive are you?
this is not a free market. no market is. monopolies are not good for the average individual. once the competition is wipe out through predatory pricing/ tax breaks they will raise their prices and the consumer will have NO CHOICE.
wake up.
@daznez First of all thank you for stopping by and reading my article.
You can say me naive, regarding this Tax situation and all. What I write here is on what I read on Internet. I always try to gather as much information I can on the subject and try to do deep research on it.
Thank you for sharing your views and sharing the information that gave us some more deep information on the topic.
About the last thing you mentioned I can't say I am not agree. It's a possibility as once there is only one choice for us we are forced to buy on the their prices whether it is high or extremely high.
Nice article. On the other hand, Amazon has also given small vendors to expand their customer base by selling online through their platform.
@banjokid Thank you for your kind comment and sharing your view with us.
@flash0 yes they are bankrupt the new startup by giving gud cashback discount offers and sales which can b harmful for small startups which is the main reason failier of most of startup in India .
@cleverbot
Thanks for the tip.
@cleverbot Thank you for your support too..
@jannatehimachal Thank you for sharing your views my friend.
Hi @flash07
I actually 100% disagree.
I've been myself running a businesss (www.promib.pl) for many years already. But since Amazong came into play our business and thousands others small local businesses are hardly surviving.
Of course not. C'mon. How can you say that giant who can compete with you having lower taxed, cheaper shipping and cheaper products does what 'every company does'.
Amazon destroyed several thousands small businesses and will continue doing so. Small businesses have no ways of competing with this giant.
Yours
Piotr
@crypto.piotr It's face that after the Amazon's rising it's hard for other companies to survive. I was not talking about every business that surviving or fall already that they were not organized well or their leadership was not that good. I wrote that based on the research that I have done, as those fall already mostly the reason what I mentioned there.
I can understand that it's hard to survive when big giant on play. As I am very small freelancer who is in race with so many companies for very small work.
I never ment to disrespect small companies or who are surviving. I am small survivor too.
Thank you for your continuous support by reading my articles and giving your honest comments on it.
Thank you @flash07 for your kind and valuable comment.
What do you freelance on daily basis? I would love to know what services do you do. Something related to crypto?
Im just very curious. Who knows, perhaps we can end up working together sometime in the future. This market is full of great opportunities and knowing right people is a must :)
All the best :)
Piotr
@crypto.piotr We do
At the moment we are not doing anything related to Crypto development.
Thank you for showing your interest and continuous support.
so good
@niyamulhasanpdc Thanks
Yes let's see how the rivals react to amazon. Good work bro.
@saubhikbiswas338 Thank you my friend
Many companies came to stamp their authority on this world of online shopping and when they could not compete with giants like Amazon, they shut down.
@educobs Yes sometimes it's better. Because it's good to try and try even if there is 0.01% chances but it's wise to leave the race if the chances are 0%.
Sneaky Ninja Attack! You have just been defended with a 21.82% upvote!
I was summoned by @flash07. I have done their bidding and now I will vanish...
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Amazon is the king,, I want etn to be accepted by them.
@pankuvirat Hope for the best my friend
I dont really think we can say that Amazon bankrupt these companies. They just didnt ckm0wte for whatever reason. If Amazon was involved on shady deals that caused or disrupted operations in favour of Amazon perhaps maybe we could say but on most of these, they failed to compete. On a mother factor, o dont understand why freight companies such as FedeX are lagging behind on drone deliveries, these are the companies that Amazon will help collapse
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@dudefromsa They were able to compete it or not, what amazon is doing is pure business. That is how they win the race. So there is nothing bad about it. About the FedeX lagging behind,it's not easy to do deliveries with drone but what they are doing is not easy to do but with Amazon support it will grow like never before. This kind of things takes time I think but with the right team & support they will win the race.