Mnuchin lays into Amazon, says it ‘destroyed’ the retail industry, hurt small businesses

https://finance.yahoo.com/m/c1bded45-0469-31c5-88ae-3a10762e7bab/mnuchin-lays-into-amazon%2C.html

U.S. Secretary Treasury Steven Mnuchin voiced his support for a new antitrust investigation into large U.S. tech firms on Wednesday, taking particular aim at Amazon.com Inc. during an interview with CNBC:

‘I think if you look at Amazon , although there are certain benefits to it, they’ve destroyed the retail industry across the United States, so there’s no question they’ve limited competition.’

Steven Mnuchin

Mnuchin compared Amazon AMZN, -0.72% unfavorably to Walmart Inc.WMT, -0.03% , another company that has been criticized for damaging small retailers. “People had those concerns about Walmart,” said Mnuchin, but “Walmart developed a business where small business could continue to compete with them.”

Amazon pushed back on the accusation that it harms small business, contending in a statement to MarketWatch: “Small and medium-sized are thriving with Amazon.”

The company added that independent sellers account for 58% of physical gross merchandise on the Amazon site, and rebutted accusations that it uses its size to stifle competition, as “Amazon’s retail business competes in a worldwide market for retail sales and represents less than 1% of global retail and less than 4% of U.S. retail.”

Amazon stock was down 1.4% Wednesday.

The Department of Justice announced an investigation into anticompetitive practices by “leading online platforms” on Tuesday. Reports have suggested that the companies being investigated include Google parent Alphabet Inc. GOOG, -0.23% GOOGL, -0.26% , Facebook Inc. FB, -2.65% , Apple Inc. AAPL, -0.57% and Amazon.

Amazon has been a frequent target of President Trump’s ire, as he has accused itof harming bricks-and-mortar retailers and not paying enough taxes.

The president has also taken to referring to the Washington Post, which is personally owned by Amazon founder Jeff Bezos, the “Amazon Washington Post,” when he has criticized the paper for negative coverage of him.

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This is heavily opinion based on my part, but I’ll state what I see here. Of course a big, successful business would hurt the smaller ones. When you fail to adapt or innovate, as well as not know what to expect in this market, that’s when they usually fall. A lot of smaller retailers are stuck in the past or are utilizing older technologies too late in the game. That doesn’t go without saying that bigger entities will enact some shady practices in order to stay on top, but that isn’t the full reason why smaller business can’t stay afloat.

From my personal experience, it’s usually because they try to take too many shortcuts, mismanage funds, poor branding strategies, and not knowing what their consumers want. There’s always a spot for businesses to have a shot if you’re just starting out, but expecting to be a big competitor to someone as big as Amazon from the get go is a sure way to fail.

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