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Amazon (AMZN) Announces In-House Food Line - Stocks in the News

The Wall Street Journal reports that e-commerce giant Amazon.com Inc ( AMZN ) has plans to "broadly expand" its collection of private-label brands which will now include grocery items like milk, cereal, baby food, and household cleaners, among other products. These items will be part of Amazon's in-house Element brand.

This expansion is similar to brick-and-mortar retail stores where name-brand products are sold beside store-owned products. For example, Costco Wholesale Corp ( COST ) has its Kirkland line, and Target Corp ( TGT ) has the Archer Farms and Up & Up lines.

Earlier in May, Amazon reportedly received trademark protection for more than two dozen product categories including soup, pasta, coffee, vitamins, water, pet food, razors, and cleaning products. In the past, Amazon has sold diapers and baby wipes-the latter is still on the market-but only available through the $99 per year Amazon Prime subscription.

The move, which comes recently after the company's announcement of a one-hour food delivery service, makes sense for Amazon, as they will now be part of the lucrative generics business. Generics typically have a higher profit margin for retailers, even though they cost consumers less.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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