) recently launched a hardware product named Amazon Dash.
The six-inch device is integrated with a microphone, speaker
and a bar-code reader. It also has a Bluetooth-enabled remote
control. Amazon Dash can scan product barcodes through the
bar-code reader and log orders on the AmazonFresh grocery
delivery account. Additionally, a user can use the microphone to
easily order groceries and other household goods from home. The
device will use a Wi-Fi connection to send the information over
the Internet to the grocery store.
However, only AmazonFresh users who are invited by the company
can sign up for the product now. Reportedly, the device is not
chargeable during the trial period.
AmazonFresh was introduced in 2007 on a small scale near
Amazon's headquarters in Seattle and later expanded it to Los
Angeles and San Francisco. The service enables users to order
groceries online which are delivered either on the same or the
next day, thus saving time and effort.
Though Amazon is not very optimistic about generating high
margins from the grocery-delivery service, it expects this
expansion to widen its operational activities (shopping) to
different categories from electronics to clothes and household
With a view to make AmazonFresh a success, Amazon has already
started investing in warehouses.
Amazon's expansion plan is likely to pose a threat to other
existing grocery chains like
Whole Foods Market.
), as well as other retailers such as Wal-Mart Stores Inc. and
Grocery is one of the most difficult sectors to crack,
especially when it comes to online shopping as is evident from
the now defunct business of Webvan. These endeavors often fail as
the operational costs (cost incurred in maintaining
infrastructural facilities for delivery on time and warehousing
facilities for storage of goods) are exorbitant while margins are
Also, since the grocery items are mostly perishable in nature,
it further increases the chances of wastage. Additionally, it is
not possible to forecast demand in this sector.
Last week, the company released an Android-based Internet
video-streaming set-top box named Fire TV. Amazon's Fire TV,
powered by Google's Android software and HTML 5, is claimed to be
three times as powerful as Apple Inc.'s TV.
We believe these new product offerings will help Amazon to
improve sales and attract new users.
Currently, Amazon has a Zacks Rank #3 (Hold).
AMAZON.COM INC (AMZN): Free Stock Analysis
KROGER CO (KR): Free Stock Analysis Report
SAFEWAY INC (SWY): Free Stock Analysis Report
WHOLE FOODS MKT (WFM): Free Stock Analysis
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