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Walmart reportedly in talks to acquire Jet.com

Walmart neighborhood market California 725 x 500

The Wall Street Journal has reported that Walmart is in talks to buy US online retailer, Jet.com.

Jet.com has been operating for a year, selling groceries and household goods across the US. It offers free shipping on all orders over $35, cheaper prices than Amazon, and is understood to have been attracting new customers at a rate of 350,000 per month.

Business Insider reports that Walmart's online sales were $13.7 billion in fiscal 2015 compared with Amazon's 2015 sales of $99.1 billion.

An acquisition would be a boost to Walmart, which has struggled to compete with Amazon, and has been investing in its e-commerce offer to try to keep up. Walmart operates numerous stores and distribution centres which could be particularly advantageous in terms of order fulfilment should an acquisition go ahead.

Walmart has recently upgraded its $49 annual ‘ShippingPass’ programme to offer a two-day delivery service, while customers without the membership can pay for rush, expedited, standard and value delivery options. By contrast, Amazon’s Prime delivery programme costs $99, and offers next-day delivery.

Neil Saunders of Conlumino said: "While Walmart does have an e-commerce offer, it is somewhat jumbled and unfocused which makes it hard for the company to compete with the likes of Amazon in specific areas like household essentials.

"To an extent Jet remedies this and would give Walmart a much more focused and powerful offering and platform with which to compete against Amazon."

Source : Insight DIY 

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03 August 2016

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