Amazon just began selling fresh food and household products in the U.K. and Germany. While Amazon already flogs these goods on its U.S. site, these are the only two countries in Europe where it has such a presence. Amazon's move challenges traditional supermarket heavyweights such as Tesco
The news should be equally good for well-established consumer-goods players such as Procter & Gamble
The Seattle titan doesn't deliver the packaged food itself. Nonperishable wares go through the post, much like Amazon's more conventional consumer products. Perishable items are fulfilled by third parties such as local food retailers.
Amazon has shown a willingness to move into almost every area of retail, using its well-known brand and website as an effective distribution portal. By avoiding a delivery infrastructure and many of the other high costs involved with traditional retail operations, Amazon has made very effective use of its capital. Traditional grocers have been trying to harry Wal-Mart with lawsuits -- but perhaps they should be more concerned by Amazon.
Jim Royal, Ph.D., owns shares in P&G. Amazon.com is a Motley Fool Stock Advisor selection. Wal-Mart is a Inside Value pick. Procter & Gamble is an Income Investor pick. The Fool owns shares of Procter & Gamble. Try any of our Foolish newsletter services free for 30 days. The Fool has a disclosure policy.