Amazon is planning to expand its business. The e-commerce giant wants to open several physical stores around the United States, similar to department stores.

Amazon Plans to Open Mini Department Stores

According to a source cited by The Wall Street Journal, the company will first open stores in Ohio and California. It will sell household items, clothing, electronics, and more, and all of them will be from top brands.

Customers will also be able to purchase products manufactured by Amazon.

While the stores are around 30,000 square feet only, they will still be larger than Amazon's other physical locations.

The plan sees the e-commerce company expanding into an area that it originally disrupted as it grew into an online shopping destination.

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Based on the physical store size that the e-commerce company is considering, it may open in strip centers. Kohl's is known to have the majority of its physical stores in this setting.

Macy's is also currently testing smaller stores closer to suburban shoppers that showcase its brand and Bloomingdale's.

Pandemic-Stricken Department Stores

The coronavirus pandemic has caused several department stores to cut hours and look for ways to entice customers because of its plummeting sales, according to Reuters.

High-profile department stores such as Neiman Marcus Group and JC Penney filed for bankruptcy last year, together with other massive names in the sector. However, some stores recovered earlier this year and are now being managed by new owners.

Macy's and Nordstrom are investing in new marketing strategies to attract customers, including opening smaller stores and strips and improving their online stores, according to CNBC.

The sudden decline of traditional department stores has been difficult for mall owners. For years, several department stores had helped bring customers to malls, but now owners of these malls are relying on grocery stores, gyms, and restaurants to bring in people.

Meanwhile, Amazon has a different fortune. Its sales have skyrocketed during the pandemic because it profited from the public's shift toward e-commerce. Its increased sales from last year even funded former Amazon CEO Jeff Bezos' trip to space.

This is not Amazon's first move into the brick-and-mortar business. It opened bookstores in 2015 across the United States, and in 2017 the company bought Whole Foods for $13.4 billion.

However, the company lost Nike in 2019, when the sneaker company decided to open its own e-commerce site. 

Recently, the e-commerce company opened Amazon Go stores in the United States and the United Kingdom. The Amazon Go Stores serves as a cashier-less grocery store. The company also has Amazon 4-star stores and Amazon Pop-Ups inside several malls.

Amazon also has grocery stores with smart carts powered by Alexa

Besides, Amazon's mini department stores allow the customers to see its wide range of electronics, from its tablets and Fire TVs to its Echo speakers and Ring home security devices. Even its Luna cloud gaming service will be available at the store. 

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Written by Sophie Webster

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