Uh Oh, Costco: You’re Amazon’s Next Target
If you thought CEO Jeff Bezos and Amazon.com (NASDAQ:AMZN) had officially covered all the retail bases, you were wrong. The company found another opening — in consumer packaged goods. USA Today reported on Thursday that Amazon is set to launch a new business in 2014 called Pantry that packages consumer goods and sends them out to Amazon Prime members for a small shipping fee.
The consumer packaged goods market is now worth about $850 billion per year in the United States, and Amazon is not willing to let companies like Costco (NASDAQ:COST) and Sam’s Club (NYSE:WMT) hog all the fun.
According to USA Today, Billy Hegeman will direct the new Amazon effort, and though the program hasn’t yet been confirmed, many details are already available thanks to the publication’s sources. Amazon plans to appeal to Amazon Prime members with Pantry because the premium membership already comes with a special shipping program. Pantry will allow shoppers to put items into their own set size boxes and then expect the packages on their doorsteps for a small fee.