retail news in context, analysis with attitude

by Kevin Coupe

Talk about different perspectives.

I was reading a story in the Sydney Morning Herald the other day that quoted Richard Goyder, the CEO of Wesfarmers, which owns Coles, the second ranked supermarket chain there, as saying that Amazon will "eat all our breakfasts, lunches and dinners."

Amazon, you see, is coming to Australia. And Goyder wants to make sure that nobody there underestimates its potential.

At about the same time, I was reading a Barron's piece about Williams-Sonoma in which an analyst was quoted as saying that "“Williams-Sonoma is very Amazon-proof."

Cody Wheaton, an analyst and assistant portfolio manager at Janus Capital, tells Barron's that "because Williams-Sonoma controls its own inventory - it’s exclusive to their channel and their brand - and it has a very strong e-commerce business, the company is more immune than most to the lurking Amazon threat.”

Here's what I would suggest.

Nobody is Amazon-proof. Nobody.

But I'm not just talking about Amazon here. In this case, one has to think about Amazon as being representative of any disruptive business model that has the potential of wreaking havoc on traditional businesses.

I just think it is healthier to start from a position of "these guys could destroy us," and then work from there to disrupt from within. Think of it as healthy paranoia.

That can be an Eye-Opener. The other way ... well, no matter who you are, I think it is akin to operating with eyes closed.
KC's View: