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According to JPMorgan, Amazon is on track to dethrone its great rival Walmart as the largest retailer in the United States next year.
Ever-increasing market share
Amazon’s American retail business has boomed in recent years: between 2014 and 2020, the company’s gross merchandise volume (GMV) in the United States grew “significantly faster” than both adjusted US retail sales and e-commerce, JPMorgan says. As a result, Amazon’s share of the American e-commerce market rose from 24 % to 39 % during the period.
Amazon is also growing much faster than its major competitor. Last year, the company’s GMV increased by 41 % to 316 billion dollars (260 billion euros), while Walmart’s GMV is estimated to have increased by 10 % to 439 billion dollars (370 billion euros). “Based on current estimates, we believe Amazon could overtake Walmart to become the largest US retailer by 2022“, CNBC quotes analysts Christopher Horvers and Doug Anmuth.
In their report, Horvers and Anmuth point to several factors contributing to Amazon’s robust revenue growth, including expansion into large, previously unexplored categories such as groceries and fashion, a surge in partner sales and the continued success of Amazon Prime. In April, Jeff Bezos reported that the loyalty programme now has over 200 million members. At the beginning of 2020, the number of members was still around 150 million.
Logistics
The strong growth of the retail branch is also having a positive effect on the secondary activities. Amazon is already one of the largest delivery companies in the United States and will deliver an estimated seven billion packages this year. In doing so, it is doing better than UPS, which will deliver around six billion packages.
In recent years, Amazon has systematically developed its logistics branch into a significant competitor to shipping companies such as UPS, FedEx and USPS. The web giant not only has an extensive network of warehouses and delivery stations but also has a considerable fleet of planes, trucks and delivery vans.
