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Chasing Amazon, Retailers Are Caught in an Arms-Race

Chasing Amazon, Retailers Are Caught in an Arms-Race

The economy is relatively strong, and consumers are spending. So why are things so tough for some retailers? Amazon is part of the picture…

New York Times, By Sapna Maheshwari and Michael Corkery

Nov. 25, 2019

Retailers are trying everything they can to keep up with Amazon. Macy’s offers same-day delivery and in-store returns for online purchases. Black Friday deals are already starting at Kohl’s. And craft cocktails are served in the women’s shoe department at Nordstrom.

By one measure, these strategies are working. After years when it seemed as if Amazon was swallowing the industry, many large old-school chains like Kohl’s and Macy’s have largely stabilized their lagging sales.

But those victories may be short-lived because retailers are caught up in a seemingly never-ending race against Amazon. The more they spend to compete, the more their profits are sapped. And even when they succeed in attracting customers, Amazon responds with new ways of delivering inexpensive items as quickly and conveniently as possible.

“Is this an arms race that never stops?” asked Christina Boni, a senior credit officer at Moody’s focused on retailers. “That has still to be determined.”

And it’s not just Amazon that has been shaking up the roughly $3.6 trillion retail industry. Dozens of start-ups, backed by private investors not concerned with immediate profits, have been chipping away at department store offerings, section by section.

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