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Business

Amazon reportedly seeking out offline stores

World's biggest online retailer reportedly searching for brick-and-mortar stores in United Kingdom to cash in on customer demand for click-and-collect.
Written by Liau Yun Qing, Contributor on

Amazon is secretly searching for brick-and mortar stores in the high streets of the United Kingdom to support its online business, according to a report by U.K.'s Times.

The golden child of dot-com pioneers, Amazon is rumored to be seeking out property landlords sin its hunt to set up physical stores to support its Web business, the article said.

The move signals the online retailer's bid to cash in on customers' demand for click-and-collect services, the report added, allowing online users to place their orders on the Web and collect the goods at a physical store. If its plans see fruition, Amazon will follow in the footsteps of U.K.-based Lastminute.com, which is "one of only a handful of Web retailers" that have physical stores.

Times quoted a source "familiar with Amazon's proposal" who said Amazon's brick-and-mortar store will "probably be an Argos-style operation". "When Amazon was just selling books and CDs that fitted easily through the letterbox, it was fine to be a Web-only business. But now it has branched out into everything from children's bikes to electrical, it believes it could boost sales by having stores that offer a collection point for shoppers," said the source.

Argos is a U.K. multi-channel retailer that receives orders online and over the telephone. The company's Web site states it was the most visited high-street retail Web site in the U.K. last year, where Internet orders accounts for 26 percent of its sales. Argos serves over 130 million customers a year through its stores.

Amazon in October began offering same-day delivery in seven U.S. cities to compete against brick-and-mortar stores, though delivery charges were "steep".

Physical can boost online
Singapore-based online bookstore OpenTrolley, offers online delivery as well as a collection point for its customers. In an e-mail interview with ZDNet Asia, Mazmur Andreas from OpenTrolley, noted that having physical collection points benefits the Web retailer.

"Some advantages of having collection points are that customers save on delivery cost, and it gives the seller legibility as well as helps gain customer trust more easily, especially for first-time buyers," said Andreas.

"Amazon does have great credibility in selling books, but not other bulky items. Having a collection point can convince first-time non-book buyer to try the new products that are going to be launched, for example, electrical appliances," he said.

He added that self-collections tend to be "fulfilled faster than delivery". According to Andreas, some OpenTrolley customers prefer to buy collectable items from the company's physical collection point because such items tend to remain in "a better condition as they are not subjected to [potential damage during] the delivery process".

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