Amazon Faces Alibaba and Retail Threat
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iStock Editorial/Thinkstock(NEW YORK) — Amazon is facing a growing challenge on several fronts.
E-commerce giant Alibaba, often called the Amazon of China, is not only going public but may expand into the U.S. and Europe using the cash raised by its IPO.
“We hope to become a truly global company,” says Alibaba CEO Jack Ma.
His company could raise more than $20 billion from its offering later this week, which would be the largest-ever IPO.
Last year, Alibaba reported almost $250 billion in sales — that’s more than what both Amazon and eBay made during the same time period.
The Chinese firm’s executives have been meeting this week with American, Asian and European investors. It will trade on the New York Stock Exchange as BABA.
Amazon is also facing a fast delivery challenge from several big retailers. Macy’s, Bloomingdale’s and Foot Locker have announced plans to test same-day delivery for online orders. And more announcements could be coming soon.
“The inventory that they have is already sitting in stores which lie about 5 miles from 90 percent of the population,” says Daphne Carmeli, CEO of Deliv, which picks up orders from local stores and delivers them within hours.
Retailers are using their stores to fight back against their biggest online competitor.
“Amazon clearly is a leader in e-commerce,” says Carmeli. “They’ve really set the bar for customer experience and in everything they do, that bar gets higher and higher.”
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