Wednesday, December 13, 2017
Business

Amazon sales growing but still behind top retailers

You might call Amazon the Napoleon of retail — aggressive by nature but relatively small in stature.

Despite all the talk about how Amazon has revolutionized shopping and sent brick-and-mortar stores into a tizzy, the online retailer is not as big as you might think.

The latest Top 100 list of largest retailers ranks Amazon ninth in U.S. sales, behind Walgreens, Home Depot and other retailers considered more mundane than planet changing.

No surprise, Wal-Mart topped the list, followed by Kroger supermarkets, Costco and Target. The list was compiled by Kantar Retail, consulting for the National Retail Federation, the world's largest retail trade association.

Perhaps most notable is the sales spread among the top 10. While Amazon did an impressive $44 billion in U.S. sales in 2013, that was small potatoes compared with Wal-Mart. The Bentonville, Ark., discount chain rang up $334.4 billion — nearly eight times more than Amazon. That's almost 1 billion dollars a day.

Even ho-hum Walgreens and CVS blew past Amazon, a result that should comfort brick-and-mortars that location does matter and street corners can trump home computers. Walgreens had $68.1 billion in sales, just ahead of CVS and its $65.6 billion.

The top retailers are heavy in the grocery business, a segment mostly untapped by e-commerce and one that Amazon CEO Jeff Bezos is strongly pursuing. No. 2 on the list was Kroger, the country's largest supermarket chain, which had sales more than double Amazon's. No. 10 was Safeway, which has no presence in the Southeast, including Florida.

Amazon's ranking was the first time in the list's more than 20-year history that the company cracked the top 10, suggesting retail's shift toward online sales. Last year, the Seattle-based retailer placed 11th.

Amazon didn't just slide into the top 10. It leaped. Its 2013 U.S. sales were up 27.2 percent over the previous year, a boost so big it might seem like a typo to other retailers.

Among the top 10, Home Depot came the closest to that, with a 6.6 percent increase. Wal-Mart's sales were up 1.7 percent, about the same as Kroger's and Walgreens'. Target's were down almost 1 percent, most likely because of the data breach that affected credit and debit cards near the holiday season. Bottom line: The top U.S. retailers aren't making huge gains or expanding wildly. Most are just holding their own.

For the takeaway, I refer back to comments made by Gary Ralston, managing partner of a Coldwell Banker commercial brokerage in Polk County. At the Retail Smarter conference in Orlando last month, he said retailers should be watching Wal-Mart, not Amazon — or any Internet seller for that matter. Wal-Mart has the volume and buying power. It also doesn't have the costly burden of delivering items to people's doors, as Amazon does.

"Wal-Mart is always going to be bigger than the Internet,'' he said.

Ikea made headlines a few weeks ago when it announced it is raising its average hourly minimum wage to $10.76 at its U.S. stores.

But Aldi says it already offers above-average industry wages. The no-frills grocery chain is holding a job fair today in Oldsmar to hire store associates, shift managers and manager trainees for its stores in Hillsborough and Pinellas counties.

The hiring event will be from 6 a.m. to noon and 1 to 6 p.m. at the Courtyard by Marriott, 4014 Tampa Road in Oldsmar, where a new store is opening this fall. Positions pay $10.50 an hour for store associates, $14.50 an hour for shift managers and $21 an hour for manager trainees.

Candidates must be at least 18 and have a high school diploma or equivalency. Employees working at least 20 hours a week receive health insurance, dental coverage and 401(k) benefits.

Contact Susan Thurston at [email protected] or (813) 225-3110. Follow @susan_thurston.

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