Amazon’s entry into the U.S. retail grocery industry through its acquisition of Whole Foods Market last year has fueled speculation that Amazon might be looking to disrupt yet another industry and make a splash into pharmaceutical supply chain players. With the acquisition of Whole Foods Market, Amazon now owns approximately 470 Whole Foods stores and has access to the distribution chains that would be necessary to enter into the pharmaceutical industry. While Whole Foods does not current operate pharmacies in their grocery stores, many grocers already do and for good reasons. Whether or not Amazon begins to penetrate the pharmaceutical industry remains to be seen but Amazon has proven itself to be a major disruptor in the past and they may consider the pharmaceutical supply chain as its next target. We are a big fan of Amazon and will keep a close eye on their next steps.
With over 100 million paid Amazon Prime members, (myself being one of them and probably the majority of our readers too) , and more than five billion items shipped to Prime members worldwide, Amazon’s core business continues to grow. When you stop and think about it, those numbers are staggering. What makes the Amazon story even more intriguing is the incredible growth Amazon has had in their non-core businesses, including, but not limited to, Amazon Web Services (the leading cloud service provider for individuals, companies, and government), Amazon Marketplace, Amazon Alexa (Their voice automation software), Amazon Video and Music (their entry into television and movies), Amazon Devices (including their Echo brands and Fire TV Stick), and now, Amazon fashion (including Prime Wardrobe allowing you to try clothing items on before purchasing). For a fascinating read, clink on the link to take you to the Amazon 2017 Annual Report.
It is truly a company unlike any we have seen, and, (as its logo insinuates) , they really do everything from A to Z.
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As discussed in RBC Wealth Management Client Note: "AMZN Impact on Pharmaceutical Supply Chain"