Etailer Amazon wants to open a physical store in Manhattan during the holiday period. It will be the first physical store in Amazon's 20 year history and a way to highlights its own products, like the Kindle tablet and the Fire smartphone.
More stores if pilot is successful
Customers can order online at Amazon and pick it up in the evening at the physical store, but the main goal is to promote Amazon's own products? If successful, Amazon might consider opening permanent stores in other cities as well. It has already experimented with pop-up stores in shopping centres.
Amazon may run into several risky situations with its own physical stores: up until now, the company has managed to avoid the costs that are related to running a traditional retail company, like rent and staff. These costs may have an impact on Amazon's profit margin, which is already very small.
Amazon has been considering its own stores for a few years now and has even looked at several potential locations in its hometown, Seattle. Its tablets were available at chains like Target and Wal-Mart, but those ceased the collaboration as they felt Amazon was becoming too powerful.