Here’s what we know so far:
Amazon swallowed Whole Foods June 16 at a cost of $13.4 billion cash (gasp!) becoming (if only just to me) AmazoleFoods.
Then the retail world exploded.
Over the last three weeks, top executives from four major retail chains have headed off in pursuit of new challenges. The CEOs of Fresh Market and Southeastern Grocers and the Chief Financial Officers of Supervalu Inc. and SpartanNash are gone with the wind. Not suggesting there’s a connection, just sayin’…
“I’m not suggesting it is okay to shoot Amazon drones out of the sky. But I guarantee you Bubba and Earl will shoot Amazon drones out of the sky.”
In that same time span German discount giant Lidl, which operates 10,000 stores in Europe in a neck-and-neck battle with Aldi, opened its first 14 U.S. locations, all in the Southeast. Giant German rival Aldi said, “Game on!” and pledged a $5 billion investment to expand to 2500 stores in the U.S. by 2022.
Meanwhile, Kroger, the nation’s largest retail chain at 3,000 stores, welcomed Lidl to America this week with a trademark infringement suit over store brand names.
And here’s one name that’s not been mentioned yet in all this hubbub: Don’t forget Costco, “which once again reminded us that traffic is never given, it’s earned” when it showed strong growth in June while almost every other retail stock retreated, according to Gordon Haskett Research Advisors analyst Chuck Grom.
In part he says in a recent report, “Importantly, traffic trends were very healthy during June, coming in +4.5% in the U.S, while the average basket [price] increased. [Costco’s] June… should serve as a reminder that not all retailers are created equally.”
Meal kits are a thing. Sort of. The market has grown to $2.2 million and Chicago-based food industry consulting firm Pentallect predicts annual growth will be 25%-30% over the next half-decade. One-in-four-Americans have tried meal kits. Some 36% would like to see their favorite supermarkets carry a store brand that costs less than private models.
On the other hand, one of the best-known, Blue Apron, took a shot when its IPO only brought in $300 million instead of the $450 million the company had hoped to fetch. Initial stock prices tumbled from an anticipated $15 per share to $10 per in light of the Amazon announcement.
Home delivery is making in-roads. In-store pickup’s a regular thing. Some savvy farmers will have a chance to get rich on Amazon as third-party providers selling directly to the public. Retailers will keep pressuring growers for thinner margins in the price wars that are erupting in the wake of the German invasion.
That’s what we know.
What We Don’t Know (Speculation Ahead Warning)
So let’s do a little projecting about what we don’t know.
From all the moaning and groaning and stock losses and people running away, we can assume that at some point there will be no stores except Amazolefoods. All former retail spaces and distribution centers will be staging grounds for their drone air force, which will make the bulk of millions of daily deliveries.
Hundreds of thousands of drones will fill the air, zipping neighborhood to neighborhood or coast to coast delivering fresh groceries and everything else anyone could ever need at a moment’s notice. They will deposit their treasures in lockboxes (it’s a true thing – the technology’s being tested now) before zooming away on their next run.
Remember, this is all conjecture. Nothing resembling this could happen until long, long, long from now – like January.
Okay, maybe longer. The important thing to remember is someday soon we’ll be surrounded by whizzing, humming drones. Some folks aren’t going to like that. It will no doubt get annoying. Some people will take the approach of one over their property personally.
There are as many guns as people in America. Some of those people resent encroachment of any kind.
So what happens if Bubba and Earl start popping delivery drones out of the sky with a deer rifle or, perhaps more effectively, shotguns?
There are probably onboard cameras that would prevent you from dropping one with a handgun. And there’s probably some destruction of property law that covers it. But if you knew you could knock one out of the sky from a distance with a .30-06, mightn’t you be just a little bit tempted in this (sort-of creepy) drone-filled futureworld?
An Opinion From Our Legal Expert
I’m not suggesting people should shoot Amazon drones out of the sky.
I’m not suggesting it is okay to shoot Amazon drones out of the sky.
But I guarantee you Bubba and Earl will shoot Amazon drones out of the sky.
Instead of spending dollars on target clays, they’ll post up in their drone blind with a couple of cold six-packs and a few bandoliers of shells, ready to go to town.
Maybe that’s a joke, maybe it’s not. I asked SPW Legal Editor Tiffany Compres, What’s to stop Bubba and Earl from blasting drones out of the sky for target practice? Because I guarantee you they will do it.
Here’s her (non-binding) ruling:
“I think destruction of property is about it – unless there are additional FAA rules, which is totally possible. And really you never know whose drone it is! On the other hand, Bubba and Earl are likely judgment-proof, so there’d be no money in it. Likely a misdemeanor or felony depending on the value of the drone and local law.”