NEW YORK: Walmart has Amazon beat on most prices for common goods, except when it comes to food says a new study.
The study by LendEDU compared prices of 50 products in five categories—from paper towels to toaster ovens to TVs and toothpaste — and Walmart was the overall winner, coming in on average up to 34 percent cheaper than Amazon. The two retailers are battling for supremacy in stores and online.
LendEDU, an online marketplace for student loan refinancing, found that Amazon’s food prices were 23 percent less than Walmart. Not surprising, since Amazon acquired Whole Foods Market in August 2017 and immediately lowered prices on common organics and other staples.
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In the home goods category, Amazon priced a 12-pack of Bounty Super Rolls paper towels at $35. Walmart’s price was $22; in the small appliances category, a Black & Decker toaster oven was $54 with Walmart’s price being $43, a 20 percent savings. Amazon priced miscellaneous items like razors and tape between 16 and 28 percent more. Margins were slimmer in the technology and entertainment category. Amazon was just 4 percent more overall, with Amazon being cheaper for cameras and fitness wearables. Walmart had Amazon beat on HDTVs and headphone prices.
When it came to grocery prices, however, Amazon trounced Walmart. Prices on coffee, pasta sauce, bottled water, soda and cereal were an average of 22.51 percent less, the survey found. Plus, Amazon offers more convenience with free delivery through Amazon Fresh, the survey noted.
Amazon charges $99 a year for a membership and offers free 2-day shipping. Walmart charges no membership fee and ships most goods for free with a $35 purchase.
LendEDU recently compared Amazon prices to Costco Wholesale and found that Amazon goods were 56 percent more than the warehouse club.
Amazon.com this month narrowed down 238 applicants for its second headquarters to 20 cities, but experts say it got something even from the losing bidders: A rich trove of information that can benefit the company for years to come.
The Seattle-based retailing giant can now use that data when figuring out how to improve its supply chain, such as by building new distribution centers or adding fleets of planes or tractor-trailers, experts say. Amazon also gained detailed information on potential sites for new facilities and an in-depth understanding of how much taxpayer money cities and states are willing to offer – potentially an immense advantage in future negotiations.
And in addition to the huge load of data Amazon received virtually free of charge, the company also generated a frenzy of coverage in newspapers and TV stations across the US for months leading up to its shortlist announcement.
“They have gotten incredible publicity out of this,” Charlotte-based consultant and development expert Michael Gallis said of Amazon’s open bidding process.
Amazon’s public search for its second headquarters was an unusual move in the normally secretive world of economic development. It sent cities around the North America scrambling to submit bids and put the best spin on their regions in hopes of landing thousands of jobs and billions in investment dollars.
Now the cities that made the cut such as Raleigh are pushing ahead to the next round, while others such as Charlotte are analyzing why they didn’t make the grade. The process has also raised questions about what bid information should be made public and how much it cost cities to pursue the project.
Scott Galloway, a marketing professor at New York University’s Stern School of Business, pointed to the cost of the effort, measured in ways such as the time economic development and elected officials spent assembling hundreds of bids, videos, tax incentive offers and detailed economic analyses for cities that almost certainly never had a shot.
“This stuff isn’t easy. It takes tons of time. This is hugely taxing,” he said. “I find this whole thing, in a word, abusive.”
While it’s possible that Amazon’s fresh collection of city-specific data could help inform its future location decisions, people shouldn’t read too much into that, said Mark Sweeney, senior principal at the Greenville-based -selection consulting firm McCallum Sweeney.
After all, much of the real estate data cities provided was specific to a headquarters-type project, he added. And in terms of workforce data, the tech jobs Amazon would look to fill at a headquarters differ greatly from the warehouse-type jobs required at something like a distribution center.
“Headquarters locations are typically not what you’d look at for something like a fulfillment center,” he said.
But the part of the proposals that may give Amazon the biggest advantage for future developments could be the taxpayer money each offered, Sweeney said.
“(Amazon has) an idea what 200-plus locations would be willing to put on the table from an incentives standpoint,” he said. “They could come back to Charlotte saying, ‘We want to do another fulfillment center, and we know how much you offered for HQ2.’”
Galloway compared the atmosphere Amazon has created for cities battling to lure the company to “The Hunger Games,” a competition he expects to continue with future projects.
Ronnie Bryant, CEO of the Charlotte Regional Partnership, the group that submitted Charlotte’s proposal, said it’s hard to estimate how much of his group’s time was spent on Amazon in the six-week period preparing the bid.
Agencies
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