Reportedly, e-Commerce giant Amazon.com Inc. (AMZN – Analyst Report) plans to add a restaurants division called Amazon Restaurants in order to expand its nascent food delivery service.
The online retailer is reportedly going to recruit staff for the new division in Seattle and New York. According to Amazon’s job database, there are at least 15 openings in Amazon Restaurants and 6 in “Amazon Restaurants and Travel”, which could be a separate unit.
Though information is scarce regarding the exact purpose of the new division, media reports indicate that it will likely help the company expand the restaurant delivery services beyond Seattle.
The move indicates that Amazon is well prepared to enter the highly competitive food delivery market and compete with companies like GrubHub (GRUB – Snapshot Report).
However, it is going to be difficult for Amazon to make a mark in this market which is already crowded with food delivery services like Postmates, Caviar and Eat24. Also, recently, Groupon (GRPN – Analyst Report) launched its own food delivery service, Groupon To Go, in Chicago.
Services are a new area for Amazon, which has so far concentrated only on selling products ranging from books to groceries to electronics. The company has been striving to beef up its delivery system to provide better customer service. Local services are huge and expanding, but it has been difficult for marketplace companies, like Amazon, to record profit since the services must be tailored to suit each city or region.
Amazon currently sports a Zacks Rank #1 (Strong Buy). Another stock worth a look is Stamps.com Inc. (STMP – Snapshot Report) with the same Zacks Rank as Amazon.
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