Amazon could create 'collection depots'

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by Jonathon Harker
Thursday, January 14th 2010 at 10:05AM

'Click and collect' rumours spark High Street store speculation

Amazon may have denied ambitions to develop a High Street presence, but the online giant has left retail questioning whether it might move into physical retail in the future.

The internet retailer – which currently sells over 250 different bike models in the mountain, hybrid, road, BMX, folding, road and cruiser categories – was rumoured to be opening physical outlets or collection depots in the UK last month. With Amazon now offering bulky items, such as bikes, and with the impact of postal strikes, speculation was rife over whether Amazon was planning future physical outlets.

Amazon denied the rumours and said: “We have no plans to open physical stores anywhere in the world.” However, the rumours have led retail to question the effect Amazon could have on the High Street, and whether it is possible in the foreseeable future.

James Flower, Verdict Research analyst, told BikeBiz: “I am not convinced Amazon would open physical stores. It has neither the expertise nor the need to do so, due to it operating in the out-performing online market. The only areas they may consider is vertical expansion so they control their delivery operations more, rather than being dependent on third-party carriers, and one solution to this is to open collection centres so customers can collect products.

“That said, I am not convinced these will be ‘shops’, but rather collection depots. Obviously, the main reason Amazon outsources deliveries is because you need massive scale to make it work, something that at Christmas, Amazon definitely has.”