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Amazon is on track to overtake Walmart as the largest US retailer in 2022, according to JPMorgan research released on Friday.
According to company analysts, Amazon’s US retail business is the “fastest growing to scale”. Between 2014 and 2020, Amazon’s US gross merchandise volume, or GMV — an industry metric used to measure the total value of goods sold in a given time period — compared both US adjusted retail sales and US e-commerce sales. It’s “quite fast”. commerce, analysts said.
Neither Amazon nor Walmart broke down GMV in their quarterly earnings results, but JPMorgan estimates that Amazon’s GMV is growing faster than its largest retail competitor. Amazon’s GMV climbed 41% year over year to $316 billion in 2020, JPMorgan analysts said, while Walmart’s GMV rose 10% year over year to $439 billion in 2020.
“Based on current projections, we believe Amazon could overtake Walmart to become the largest US retailer in 2022,” JPMorgan analysts Christopher Horvers and Doug Anmuth wrote Friday.
Howers and Anmuth highlight some of the factors they believe are driving Amazon’s top-line growth, including third-party seller sales in “larger and less-entry categories” such as grocery and apparel. Includes strong rise and “prime flywheel”. Amazon CEO Jeff Bezos said in April that the company now has more than 200 million Prime customers, up from 150 million in early 2020.
The coronavirus pandemic has rapidly accelerated e-commerce adoption and cemented Amazon’s dominance in retail. Stranded consumers turned to Amazon for a plethora of items ranging from toilet paper to workout gear. They also relied on Amazon for services they might not have considered otherwise, such as online grocery delivery.
Amazon’s pandemic-fueled sales growth has helped it grow its slice of the e-commerce market. JPMorgan estimates that Amazon will increase its share of the US e-commerce market to 39% in 2020, up from 24% in 2014.
The rapid adoption of e-commerce has also fueled other areas of Amazon’s business.
Amazon is well on its way to “becoming one of the largest delivery companies” in the US, Bank of America analysts wrote in research published Tuesday.
Analysts wrote, citing data from MWPVL International, a supply chain and logistics consulting firm, that Amazon is projected to deliver 7 billion packages in 2021, surpassing the roughly 6 billion packages delivered by UPS in the US this year. has gone.
In recent years, Amazon has quietly created a shipping operation that takes on the likes of UPS, FedEx, and the US Postal Service. It maintains a growing network of warehouses and last-mile delivery stations, and a vast logistics operation with airplanes, trucks and vans.
This has allowed Amazon to place most of its orders on its own. Amazon currently delivers packages to other businesses in the UK and may one day expand that service to the US
MWPVL estimates that Amazon handled about 5 billion of the 7.35 billion packages shipped in 2020. According to Bank of America analysts, UPS and USPS handled another 1.25 billion and 1.1 billion respectively.
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