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Aster's avatar

Do you agree with this comment by Jim Cramer of Mad Money?

Asked by Aster (15835 points ) 3 months ago

Jim said, “Amazon.com is making grocery stores obsolete.”

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14 Answers

dxs's avatar

No, that’s Wal Mart.

johnpowell's avatar

The guy has never been right about anything.

And most of my trips to the store are impulse buys. And buying bananas online seems nuts. I like to inspect meat and produce first.

Aster's avatar

I didn’t think meat and fruit were available from amazon. I think he was exaggerating.

CWOTUS's avatar

Peapod could make supermarkets obsolete, in the same way that supermarkets made grocery stores obsolete. (Of course, Peapod is a marketing arm of Stop & Shop, a major Northeast supermarket chain.)

It’s not that supermarkets are going to “go away” all of a sudden (just like small mom-and-pop grocers haven’t completely left the marketplace, either), but Peapod and such online grocers add a level of convenience that customers are willing to pay for, and to give up some of the amenities of doing business in older ways.

I have no doubt that Amazon will eventually do the same thing, but I don’t know that they actually have, yet. (They have made “bookstores” obsolete, which is a huge complaint of book lovers who like to browse bookstores, to lounge there, to meet others there, etc.)

elbanditoroso's avatar

Amazon is not going to put groceries out of business – never. Or at least not until they have extremely good delivery service all over everywhere, combined with an extremely good fresh food/salad/fish/meat department.

They might be competitors on packaged and dry goods, but not a chance on anything fresh.

CWOTUS's avatar

Don’t conflate “obsolete” with “out of business”, @elbanditoroso. There is no reason why Amazon can’t develop a model to pick, pack and deliver fresh foods in the same way that Stop & Shop already does. And there should be no assertion that even if they do that, that they will put any competitors “out of business”, in the same way that they haven’t actually put bookstores out of business – unless the bookstores don’t adapt their own practices to accept lower margins, offer more services, provide rare books that Amazon won’t stock, etc.

ucme's avatar

Yeah, yeah & no more newspapers, no more books, don’t agree.

bea2345's avatar

I rather think that groceries will be around for awhile. There are always occasions when you are cooking or doing housework – or anything for that matter – and you discover that you have no window cleaner, or salt, or sticky tape. The something can be anything, but you need it now otherwise the project will not get done today. That is when you run down to the nearest corner store or grocery. Amazon can’t do that for you. Have you ever run out of matches when staying in a house that uses a gas stove (the kind that needs matches)? I cooked on a stove like that for 20 years.

flutherother's avatar

Amazon is putting all stores except grocery stores out of business I would have thought.

eno's avatar

I haven’t walked into a store for literally anything since online shopping became available. That is like 15 years ago.

In general, the more popular online shopping becomes (which really means the more savvy the general public becomes with computers) the less stores you’ll see. Stores can’t compete with internet prices because of overhead costs. Also, buying online, in bulk (dry goods), gives you a much larger discount (especially if you buy during holidays so you can buy it on sale and add in promotion codes.

Fresh produce is still limited to specific areas for now, but I have been using freshdirect since early 2000. They sell everything, including organic.

AmazonFresh was created in 2007 to compete with sites like freshdirect, but also limited to only a few areas (beta testing). However, while the whole online shopping will outperform storefronts, Amazon doesn’t always have the best price.

jca's avatar

I don’t buy a lot of meat, but I know when I do, I like to choose it myself.

I think grocery stores will be around for a while. I can think of a bunch of situations where people will need to use grocery stores. I am on vacation right now and we’re going to the store almost daily to pick up stuff for dinner, stuff for the vacation house, fresh fish from the harbor market.

When I go visiting people, I inevitably stop at a grocery and pick up stuff to bring to their house.

Amazon was on the news a few months ago, with stories of drones delivering their items in the future. Until that time, I can’t envision them making grocery stores obsolete.

I know since joining Costco, I go there more than a typical grocery store. The price of milk alone makes my visit worth it. I do the “Executive membership” where I get 2% cash back. The Exec membership is $100 a year, but I get about 65–80 dollars back, which makes the membership so extra worthwhile. The regular membership is $50 but you get nothing back. Even so, that 50 would make it worthwhile, for me.

CWOTUS's avatar

Grocery stores will be around forever, but that’s not the point. Most people currently get most of their groceries most of the time from supermarkets. In that sense, “supermarkets have made grocery stores obsolete”, and that happened a long time ago, probably before most of us were born.

So it seems safe to assume that supermarkets have now also hit their high water mark – at least in the USA – some other countries and cultures with stronger aversion to various culture changes introduced by online shopping (at least some of the economic changes) may delay the Amazon-type business model for a few more years or decades. But as people continue to opt for convenience and low price over the ambiance of smaller and more intimate and hands-on shopping afforded by small grocery stores (again, for most shopping, most of the time), then the Amazon / Peapod / FreshDirect model will gain traction and market share, especially as modes of delivery improve as well (drones and self-driving cars, for example).

However, until direct-to-home drone delivery is a more common thing – and as far as I know it’s not a real, everyday commercial thing anywhere yet – and legislation and regulations finally allow self-driving cars and (one presumes) some kind of robot delivery-to-door mechanism, Cramer may just be premature, but certainly not “wrong”.

bea2345's avatar

^^^^ Again, I am astonished by the high dependence on technology. ”... self-driving cars and (one presumes) some kind of robot delivery-to-door mechanism…” sound like science fiction but are all possible. About two weeks ago a back-up generator was installed at our local clinic. That is progress, so perhaps one day we will even see hand held ultrasound scanners so efficient that the stethoscope manufacturers will go out of business.

SecondHandStoke's avatar

Remember that while Cramer isn’t always wrong you are watching an entertainment program.

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