With lockers set up in Staples (NASDAQ:SPLS), trucks delivering fresh groceries in Seattle, and a television mount service in its first stages of operation, Amazon (NASDAQ:AMZN) is expanding the definition of what it means to be an Internet retailer. As GeekWire reported on Tuesday, the company has contracted with a Seattle-area company to install TV mounts in homes.
Where is Amazon Going with this Idea?
“The creation of a local marketplace for services marks a bold experiment for Amazon, potentially putting the company in competition with the likes of TaskRabbit or Angie’s List (NASDAQ:ANGI),” according to GeekWire. The service, which is priced at $275, includes the equipment necessary for the installation and the associated labor costs.
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Amazon has made other steps into the service and delivery business with its AmazonFresh operation, which was introduced before the Kindle. While grocery stores have notably low margins and few grocery delivery services have made the model profitable, the Internet retailer has continuously added trucks, staff, and products to the service since it launched five years ago. While its grocery delivery only operates in Seattle, “execs are constantly debating the wisdom and timing of expansion,” Bloomberg reported in a September article.
CHEAT SHEET Analysis: What are the Benefits of this New Product Pipeline?
One of the core components of our CHEAT SHEET Investing Framework requires that companies consistently produce successful products or services. In this case, both Amazon’s grocery delivery and television mount services challenge the way Amazon has traditionally done business; AmazonFresh requires the retailer to ship items within a few hours, rather than after several days, and its home installation service is dependent on the skill of contractors. Yet, these new services bolster the company’s core retail business by expanding the goods and services it offers on Amazon.com
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