Every time I think I’m done with this vertical integration obsession another example pops up.
Rumours are flying around the news sites that the giant of online retailing Amazon might be bringing a portion of its delivery process back in-house.
They are reportedly considering opening old school bricks-and-mortar shop fronts in the UK where buyers can pop past to pick up their purchases.
This would represent a substantial shift in the business model of the firm, and also a convergence back with various other high street retailers (most notably in the UK Argos) who also have a strong online presence.
It is also an interesting example of adaptation to the quirks of infrastructure and custom from location to location. Parcel deliveries may be less practical in the UK given different living arrangements, and customers are more densely situated meaning such distribution points could be viable.
Tags: Amazon, Argos, books, business, forward integration, International business, local adaptation, local responsiveness, retail, Retailing, Strategic management, United Kingdom, vertical integration
International BS Blog 
December 16, 2009 at 8:20 pm |
reading this makes me think there is an inverse relationship between smart strategic decisions and the size of the organisation.
Both these moves have disaster written all over them – or as the great Peter Lynch would say they are: Diworsifications – sell your shares now.
Steve.