Should SME businesses be threatened by Amazon’s catering equipment takeover? In early October 2018, Amazon confirmed the signing of Blanco Professional as its first major foodservice equipment supplier in the UK. The partnership will see the catering equipment manufacturer distribute through Amazon Business on items such as trolleys and food transport containers.
With the new agreement bringing big changes to the industry, will small to medium enterprise (SME) businesses have to rethink their strategies? With his top tips of what to look out for, catering equipment business owner, David Teasdale shares his views:
What effect do you think Amazon business will have on independent businesses?
Amazon is a market disruptor and a hegemonist, with huge resources, and so if it chooses to enter a market then all the incumbent players need to watch out, irrespective of size.
What can SMEs do to compete with companies like Amazon?
Amazon may struggle to provide service-led propositions to consumers, or complex solutions to individual needs. Companies should therefore focus on being adaptive to individual needs, including reassessing warranty and services options.
Why do you believe they are investing so heavily in the catering equipment industry?
Amazon clearly sees value in this market not only its current value but also its future value. I suspect that it also sees that it can take market share quickly from the incumbents with its huge operational and marketing advantages.
How do you think this will shape the industry in 2018?
Amazon Business has shaken up the industry enough for all businesses, never mind SMEs, to stop and think about what more they could be doing. Three key areas that businesses will need to consider will be price of goods, value of goods and delivery lead times. One thing is for sure the next five years will be a very different environment in which to operate compared the last five years. The UK is the first country where Blanco Professional has signed this kind of agreement. However, if successful, could it be the first of many. Whether customers will choose to buy from the business giant, or stick with local specialists, only time will tell.