"Amazon's move into online groceries isn't really about making money."

#Money

Thu, Jun 6th, 2013 21:00 by capnasty NEWS

Selling fresh fruits and vegetables online is a "difficult business that comes with expensive costs, like fuel-hungry refrigerated trucks." Yet, Quartz's Gina Chon thinks Amazon will be able to do it thanks to its logistical expertise.

Selling fresh fruits and vegetables online is a difficult business that comes with expensive costs, like fuel-hungry refrigerated trucks, which leads to small margins. But Amazon’s move into online groceries isn’t really about making money. Instead, it is seen as a way of making Amazon’s burgeoning same-day delivery service more cost efficient.

Amazon also has the logistical expertise that could help in online groceries where others have failed. And offering fresh produce is one area that Amazon’s competitors in other sectors, like technology, would probably not venture. Amazon would seal its place in the consumer mind as the go to place for everything.

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