Does Amazon Own Walmart In 2023? (All You Need to Know as an Amazon Seller)
As an experienced Amazon seller, I often get asked whether retail giants Amazon and Walmart have some kind of ownership relationship or merger.
The short answer is no – Amazon does not own Walmart in any capacity. But the relationship between the two companies is complex, so let‘s take a deeper look.
Comparing the Core Businesses of Each Company
While Amazon and Walmart both sell a wide range of consumer goods, their underlying business models are quite distinct:
Amazon generates most revenue from its ecommerce marketplace platform. This is supported by extensive warehousing and delivery operations.
Walmart still relies heavily on in-person sales at its thousands of brick-and-mortar stores worldwide. But it‘s growing its ecommerce business aggressively.
As Amazon sellers, we‘ve watched Amazon disrupt physical retail by empowering third-party merchants to easily reach customers online. Selling on Amazon provides access to over 200 million Prime subscribers.
Meanwhile, Walmart touts its network of stores for convenient omnichannel services like in-store and curbside pickup. As of 2022, Walmart operated over 10,500 stores worldwide.
But this clear differentiation between online and physical is blurring. Amazon now operates physical grocery stores and Walmart is investing billions to transform into an "omnichannel" retailer.
How Past Acquisitions Have Reshaped Each Company
Both companies have made major acquisitions to quickly gain ground in new areas:
Amazon’s Key Acquisitions
- Whole Foods (2017) – $13.7 billion
- Zappos (2009) – $1.2 billion
- PillPack (2018) – $753 million
Walmart’s Notable Purchases
- Jet.com (2016) – $3.3 billion
- Parcel (2017) – undisclosed amount
- Bonobos (2017) – $310 million
Amazon‘s purchase of Whole Foods gave it a national grocery footprint almost overnight. As sellers, these stores also represent physical real estate to potentially showcase our products.
Walmart acquired digital natives like Jet and Bonobos to jumpstart its ecommerce business. And services like Parcel optimize Walmart‘s supply chain to achieve faster delivery times.
How the Giants Compare in Terms of Size
Despite Amazon’s explosive growth, Walmart still edges it out in annual revenue and profit…for now:
Walmart (FY 2022)
- Revenue: $573.78 billion
- Net income: $13.67 billion
- Employees: 2.2 million
Amazon (FY 2022)
- Revenue: $513.76 billion
- Net income: $33.36 billion
- Employees: 1.6 million
However, analysts expect Amazon to overtake Walmart as the #1 US retailer as early as 2025 based on growth trajectories. Walmart also faces challenges in adapting its massive global workforce to digital operations.
And while Walmart has more physical locations, Amazon operates over 200 fulfillment centers in the US alone. Combined with its partner network, Amazon‘s logistics infrastructure is unmatched.
As sellers, we directly benefit from Amazon‘s expansion into grocery and one-day delivery, giving us access to even more potential customers.
Areas Where Amazon and Walmart Directly Compete
The retail giants are locked in intense competition across key segments:
Online Sales
- In 2021, Amazon accounted for 38% of US ecommerce spending, 6x higher than Walmart‘s 6% share.
Physical Retail
- Walmart still dominates. It operates over 4,700 US stores while Amazon has only 30+ Amazon Go and Fresh locations.
Grocery
- Both offer grocery delivery on a national scale. Walmart Grocery reached 300 million US households in 2022, competing with Amazon Fresh and Whole Foods.
Third-Party Marketplaces
- Amazon Marketplace is the clear leader – in 2021, sales by 3P sellers reached $313 billion, more than Walmart‘s entire revenue.
Private Labels
- Amazon and Walmart both sell increasing shares of self-branded goods. Amazon owns over 170 private labels like AmazonBasics.
This multi-front competition means both companies will remain laser focused on innovating in ecommerce, supply chain, grocery, and fulfillment – areas we directly benefit from as sellers.
Why Acquisition Remains Unlikely Despite Competition
Given the intense competition between the two giants, some may wonder why one wouldn‘t acquire the other. Here‘s why that remains unlikely:
Scale – Walmart is still the world‘s largest company by revenue, so acquiring it would likely be unfeasible for even Amazon.
Business Models – Though converging, each company has core strengths that would make integration difficult. Walmart in physical stores, Amazon in ecommerce.
Investments – Both continue pouring billions into transforming towards omnichannel capabilities making acquisition redundant.
Antitrust – A merger could prompt greater antitrust scrutiny on Amazon, especially under newer standards.
As sellers, we benefit from Amazon and Walmart continuing as independent companies. The competition forces each to expand selection, improve delivery speeds, and invest in new in-store technologies – providing us opportunities for growth.
While Amazon buying Walmart remains improbable even as they encroach into each other‘s turf, the retail titans will continue redefining what customers expect from shopping experiences.
The Outlook for Amazon and Walmart
In my view as an Amazon seller, here‘s what the future looks like for these two retail juggernauts as they reshape commerce:
Amazon will likely overtake Walmart as the largest US retailer in the next few years by accelerating innovation in physical retail and grocery to complement its digital dominance.
Walmart will defend its brick-and-mortar turf while continuing to pour resources into closing the online gap with Amazon. Its massive global workforce and household reach ensure its continued dominance for the foreseeable future.
Fierce competition across all retail segments will mean both companies have no choice but to continue pushing the boundaries. As Amazon sellers, this rising tide lifts all boats by broadening our customer reach.
While Amazon buying Walmart remains unlikely, together they will offer sellers like us tremendous opportunities to grow our businesses in a rapidly evolving retail world. As peers navigate this changing landscape, my advice is to take advantage of each company‘s expanding capabilities and meet customers however they choose to shop.
