Amazon Juggernaut Sets Its Sights On Its Next Victim: The Middleman

  • The growth of Amazon has the potential to disrupt “middlemen,” particularly in the industrial space.
  • Amazon Business now has 300,000 registered corporate buyers and recently surpassed $1 billion in sales.
  • Stocks like W.W. Grainger and Fastenal could come under pressure from Amazon, analysts say.

Before it was Amazon killing the retailers. Last week it was Amazon disrupting appliances. Now there’s a broader concern: Amazon has the potential to disrupt the middleman in general, particularly those that work in the $7 trillion business-to-business (B2B) space.

Here’s the issue: If you don’t make the object you are selling, or don’t have some sort of intellectual property, or solve a pain point for a customer, then you’re just a middleman, and you are increasingly more vulnerable. The concern is that these middlemen will start losing volume because sales in general are going to the internet and because it’s increasingly difficult to get pricing.

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