Can Amazon Get Bigger?

Well, Yes.

It seems all we heard about in 2017 was Amazon, Amazon, Amazon.  Weather it was the news of their purchase of Whole Foods, the super successful PrimeDay event, or the addition live Thursday Night NFL games on their video service; it seems that CEO Jeff Bezos (the richest man on the planet) knows exactly how to make Amazon grow.

When you look at one of Amazon’s biggest competitors, Wal-Mart; you will see that Amazon’s Market Capitalization is almost double that of Walmart ($558Billion to $286B)1.  But the interesting number is annual sales revenue. Walmart is crushing it at number one in the world at $486 Billion annually.  While Amazon is only at $89B per year.  This might be an indication that there is still plenty of revenue to gain from the competition.  So how is Mr. Bezos going to grow Amazon in 2018.

  1. Business to Business. Amazon’s business platform lets small businesses order supplies from other businesses. Their prowess in logistics allows them to smooth out the process.
  2. International. India, Mexico and Australia could be options that you see Amazon expand into. India alone is a $1.1 trillion retail opportunity.
  3. Core Retail Business. While an RBC Capital survey shows a high adoption rate to the Prime Service, there still is growth opportunities in the company’s apparel, consumables, and food categories. Amazon continues to show that they can get people to spend more money on their platform. The survey shows that the average Prime user, spends about $800 per year on their site.
  4. Advertising. With a growing number of eyeballs on their pages, Amazon should leverage their massive database to increase their advertising revenue in 2018.

While it is not all roses for Amazon, it is hard to see the company slow down anytime soon.  And we have not even seen what they are going to do with Whole Foods.

*1 Revenue and Market Cap numbers from Yahoo Finance.com

About the author  ⁄ Van Pappas

Van Pappas

Van Pappas, CFP® - Van is a native of Atlanta. He holds his undergraduate degree in Finance with an emphasis in Real Estate. As a planner for 15 years, he earned his CFP designation from Kaplan University. He is currently the Chairman and founder of the Chamblee Chamber of Commerce and sits on the Downtown Development Authority for the City of Chamblee. In 2012, he noticed the value of helping the X-Y Generations and decided to merge his practice with oXYGen Financial. Background and qualification information is available at FINRA's BrokerCheck website.Securities offered through Kestra Investment Services, LLC (Kestra IS), member FINRA/SIPC. Investment advisory services offered through Kestra Advisory Services, LLC (Kestra AS), an affiliate of Kestra IS. oXYGen Financial is not affiliated with Kestra IS or Kestra AS. Kestra IS and Kestra AS do not provide tax or legal advice.

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