Amazon Wants Online Industrial Goods Market, Other Markets Too! (AMZN, GWW, EBAY, RBA)

Amazon.com, Inc. (NASDAQ: AMZN) must have the goal that if you can sell it online then it wants a piece of it.  After many specialty online sales initiatives, now it seems that the online industrial tools business is a focus.

Amazon’s new AmazonSupply.com is selling a broad array of scientific, industrial, and business supplies, occupational safety, tools, and many other large-scale parts and equipment.  The aim here is to capture a small piece of the materials, hydraulic equipment, fasteners, lab & scientific equipment.  The amazonsupply.com site claims some 500,000 items with more added every day.

A report from Citigroup is claiming that this is direct competition for W.W. Grainger, Inc. (NYSE: GWW) for its 27% sales that come from online as the Amazon site is said to often have lower prices for the direct same products of Grainger on the informal price comparison.  Citigroup maintained a ‘Sell” rating and shares are down 4% at $202.64.  Now we know at least one more reason as to why Amazon was buying that robotics company for warehouses.

There is perhaps a larger concern here.  Amazon has often competed against the “Buy It Now” feature of eBay Inc. (NASDAQ: EBAY) because after all this is a store offering versus a store offering.  Amazon is branching out further and further and no one knows where it will stop.  Perhaps another question is whether or not Amazon (or others) go after Ritchie Bros. Auctioneers Incorporated (NYSE: RBA) for its on-site and online bidding process.  Ritchie Bros. sells used and unused heavy industrial equipment, trucks, and other machinery.  It has a market cap of just under $2.2 billion but sales were $348 million in 2011.

If you have an online products marketplace or an online exchange of goods, chances seem high that Amazon or other giants want a piece of it.  Amazon has bought Zappos.com for an online shoe market and it has entered into many other online sales as well.  It now even has a large area for sports collectibles and memorabilia.  Jeff Bezos wants a piece of anything and everything you can buy or sell.

JON C. OGG