New study highlights Amazon's threat to bricks and mortar retail
Posted on in Business News , Cycles News
A study from the American Booksellers Association and research firm Civic Economics has demonstrated the impact that Amazon has on bricks and mortar retail.
This report aims to determine how Amazon is affecting communities and economies in the US, in terms of fiscal impact and land use.
Despite the report being focused on the US, the findings will be as relevant to the UK retail market, which is facing the same threats.
The American Booksellers Association and Civic Economics have long collaborated to study and describe the state of independent retail in America, but until now those efforts have focused on various classes of brick and mortar stores. This report takes that research into a new era. According to the authors, the report is designed to provide policymakers and consumers with a better understanding of the impact at the state and local level of the growth of online retail as a substitute for storefront purchases.
To demonstrate just how big the growth of online retail is, MasterCard reports that online sales increased 20% between Black Friday and December 24; in contrast, total retail sales rose just 7.9%.
Key findings from the report
- In 2014, Amazon sold $44.1 billion worth of retail goods nationwide, all while avoiding $625 million in state and local sales taxes.
- These sales are the equivalent of 31,000 retail storefronts or 107 million square feet of commercial space, which might have paid $420 million in property taxes.
- A total of more than $1 billion in revenue is lost to state and local governments, $8.48 for every household in America.
- Amazon also operated 65 million square feet of distribution space, employing roughly 30,000 full-time workers and 104,000 part-time and seasonal workers.
- Even counting all the jobs in Amazon distribution centers, Amazon sales produced a net loss of 135,973 retail jobs nationwide.
To view the report in full click here