The Impact of the Internet on the Retail Industry

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The internet has significantly impacted the retail industry: A qualitative & quantitative analysis of Amazon online shopping & Wal-Mart retail stores

Table of Contents

INTRODUCTION___________________________________________________________3-4

PORTER FIVE FORCES ANALYSIS__________________________________________4-5

AMAZON HISTORY________________________________________________________5-7

AMAZON SWOT ANALYSIS________________________________________________8-10

WAL-MART BUSINESS DESCRIPTION_____________________________________10-11

WAL-MART BUSINESS MODEL______________________________________________11

WAL-MART HISTORY______________________________________________________11

WAL-MART
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Threats of New Entrants
The barrier of entry is medium since there are competing companies. For example, Amazon 's Kindle Fire versus Apple iPad (Zimmerman 2010). The threat of new entrants is medium to low, since new companies are gradually getting into the online business. For example, in December, 2011, eBay made revenues of about $3.38 billion, which is about 19.3% of Amazon’s revenue.
2. Bargaining Power of Suppliers:
The bargaining power of the suppliers is very low since there are many suppliers who are willing to sell their goods online using Amazon.com. The goods are usually sold to a third party, and suppliers are paid quickly.
3. Threats of substitutes:
The threat of substitutes is very low, because of innovative services that improve the quality of goods within a short period of time. There is also high brand recognition for the company that makes it difficult to substitute their products. In addition, there is high customer satisfaction since they get quality goods from the company. The company also offers well-recognized and trusted services. Lastly, this makes the threat of substitution very low.
4. Rivalry among industry competitors:
There is stiff competition among the retail companies. The competition between Amazon and Wal-Mart is very stiff, since both companies are using almost the same methods to remain leaders in the retail industry. Both companies are using an online mechanism to sell their products, as well

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