Dividends and Italians flocking to Amazon amid pandemic

COVID has changed retail shopping in the US, but in some countries shopping on line was pushed ahead a number of years, but people were already shopping on line. All retail companies over the past few years have invested in shopping online, COVID pushed the line ahead the equivalent of 10 years into 1 year. Then there are countries where companies similar to Amazon were available but were being subsidized by countries such as the US, Germany and Britain. An example is Italy.

In an article by Adam Satariano and Emma Bubola of the New York Times News Service, Italy is a country that has preferred to shop in stores, pay cash to buying online in record numbers. If you think about Italy, the numerous coffee shops for people to go outside brings an image that seems natural. Go shopping and stop at small restaurant before going home.

North America is Amazon’s largest market accounting for 2/3s of its $245.5 billion global consumer business. But the Seattle based company has been targeting Europe and other markets to grow.

Amazon entered Italy 10 years ago or in 2010, and prior to COVID 40% of Italians shopped on line compared to 87% in Britain and 79% in Germany according to Eurostat, an European Union government statistics group. Although people shopped on line, e commerce accounts for 8% of retail spending in the country.

In 2020, the total online sales are estimated to grow 26% to a record E22.7 billion ($35.4 billion) according to researchers from Polytechnic University of Milan.

One reason for fewer online shopping in Italy is small and medium sized businesses make up roughly 67% of the economy and 78% of employment. Many companies saw online as a life line or opportunity to stay in business.

Amazon has added 2 new fulfilment centers and 7 delivery stations pushing its workforce up to 8,500 well up from the 200 in 2011.

Linking to dividend paying stocks, to build up and take advantage of opportunities companies need the infrastructure in place. When demand builds the process is repeated over and over to satisfy the customer and keep them coming back. In Italy there were challenges with internet infrastructure but all companies had the same concerns, who takes advantages of it?

There are more questions than answers, till the next time – to raising questions.

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