Amazon.com Inc. is gearing up to enter the business of selling prescription drugs, which, according to analysts, will threaten the biggest drugstore chains in the United States.
Analysts pointed out in their reports that they are expecting Amazon.com Inc’s announcement within the next 1-2 years, “It’s a matter of when, not if,” adding that they expect Amazon to start selling medicines online by 2019.
CVS Health, Rite Aid, and Walgreens’ stocks all dropped 4 percent or more each at the looming threat of Amazon disrupting the hold of the traditional distributors on the drug prescription market.
Amazon has been reported meeting up with mid-market pharmacy benefit managers as well as hiring new people for the assessment of the drug retailing market for its entry.
The drug prescription retailing market sure has its allure with what analysts estimate to be $560 Billion annual market income. Sources familiar with the company’s way of thinking claimed that Amazon is “well-aware of the complexities.”
A report was made which said that Amazon will announce a decision about whether the company will be moving into the business of drug retailing before Thanksgiving.
Shares of CVS Health and Rite Aid closed down at 4.9 percent, while Walgreens declined by 5.8 percent.
Wal-Mart Bridges Gap Between Online and Offline Business
Amazon’s arch-rival, Wal-Mart Stores Inc., is launching a new in-store returns service this November which will be called Mobile Express Returns.
Wal-Mart promises their shoppers faster time in processing their returns, from its previous average time of 5-minutes to 30 seconds. Their new system will also credit their customers instantly for returns of some items without the customers needing to give them back.
Daniel Eckert, Wal-Mart’s senior vice president of services and digital acceleration, explained in an interview that they “recognize that saving time is the new currency for customers, as much as saving money.”
People who purchase items online, which has to be returned or exchanged, can do so easily by logging into Wal-Mart’s app which will generate a QR code for the transaction, and then waltzing into a physical Wal-Mart to complete the transaction. For bulky items, the customers can still get their refund without giving their items back through a program referred to as “keep it.”
Amazon also did waste no time in building a similar system with its recently acquired grocery chain, Whole Foods. Returns are now processed at Whole Foods stores across the U.S.
When asked about how Wal-Mart can prevent customers from abusing their “keep it” program, a company spokesperson answered, “We will be using technology to help us spot irregular behavior. We aren’t able to share any additional details for competitive reasons.”