Amazon May Turn Abandoned Stores Into Fulfillment Centers

Marco Green
August 10, 2020

A report by the Wall Street Journal on Sunday stated the e-retailer and Simon Property Group Inc., the largest mall owner across the United States, have been in discussions about using spaces previously occupied by Sears and J.C. Penney.

Amazon has more than 175 fulfillment centers across the globe, around 110 of which are located in North America. Inc. and Sears Holdings Corp. into Amazon fulfillment centers, Dow Jones reported, citing people familiar with the matter.

The deal could involve Amazon taking over spaces formerly occupied by Sears and JCPenney, both of which have filed for bankruptcy and closed dozens of stores. An Amazon Operations spokeswoman would not comment on the reports.

Amazon spokesperson Rachael Lighty told Business Insider that the company would not comment on "rumors or speculation". Advertisement The deal could benefit Amazon by providing well-located warehouse space in cities across the USA, potentially allowing the online retailer to decrease its delivery times on shipments.

The coronavirus pandemic has significantly impacted the brick-and-mortar retail industry. There were about a dozen total vacancies among retailers and food establishments and other stores not ready to open doors just yet. Shutdowns from Covid-19 have forced many to close for good, while Amazon reportedly doubled its net profit year over year to $5.2 billion in its second-quarter earnings results.

For Amazon the Simon deal is a logical effort that would bring distribution hubs near residential areas to speed up delivery times.

The report said it was not yet clear how many stores were being considered and that an agreement may not come to fruition.

But having an indoor location would be a first for a major mall operator offering prime retail space to the e-commerce giant. The choice also won't please nearby tenants: fulfillment centers draw less foot traffic to the mall, and it would help make Amazon, seen as a disruptor of retail businesses, even more competitive.

Alternatively, Amazon has also been in talks with multiple mall landlords about putting its coming grocery-store chain in JC Penney locations, one source said.

Other reports by Click Lancashire

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