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Amazon plans to open large retail locations that are similar to department stores, according to a report in the Wall Street Journal.
The newspaper reported, citing people familiar with the plans, that some of the first Amazon department stores are expected in California and Ohio. The locations will occupy about 30,000 square feet, about the size of a Kohl’s or TJ Maxx location, but still about a third the size of a traditional department store.
The move would mark Amazon’s latest experiment with physical retail stores after stealing market share in the retail landscape from incumbents with their e-commerce business. The company recently overtook Walmart as the world’s largest retailer outside of China.
In recent years, the company has bought Whole Foods Market and opened stationary bookstores, Amazon-branded grocery stores, and cashless convenience stores. Physical locations have higher fixed costs, but can attract more attention and allow consumers to try on clothes.
Department stores are set to help Amazon sell more clothing and tech products, the journal said. The newspaper reported that the company first began reaching out to U.S. apparel brands about large-scale stores about two years ago, though it is unclear at the time which brands would stock the locations. The e-commerce giant also plans to sell its own private label products.
Amazon’s entry into department stores would put even more pressure on an already ailing retail segment. JC Penney, Lord & Taylor and Neiman Marcus were among the retailers who filed for bankruptcy last year. Nordstrom and Macy’s have invested heavily in bringing new customers, including opening smaller stores and improving their e-commerce business.
A representative for Amazon said in a statement to CNBC that the company is not commenting on rumors and speculation.
The company’s shares are down more than 1% this year, equating to a market value of $ 1.59 trillion.
Read more about Amazon’s plans here.
