Source: Amazon.com
Wayfair.com, Williams-Sonoma and any other retailers selling furniture and appliances online beware. Amazon.com has its sights set on ruling the online market for these products and is building "four massive warehouses" designed to quickly fulfilling orders, according to a Wall Street Journal report.
Furniture, as per the Journal's reporting, is among the fastest growing product categories online. Roughly 15 percent of the $70 billion market for furniture in the U.S. has moved online, according to IBISWorld.
As it has done in other categories it has entered, Amazon is expanding its selection. Veenu Taneja, furniture general manager for the e-tailer, said Amazon is also adding custom design services for furniture and increasing the number of locations where deliveries can be made in one or two days.
Wayfair CEO Niraj Shah, who appeared on CNBC's "Closing Bell" show on Wednesday, said people shop differently for furniture online than how they shop for other products and this behavior should benefit his site.
"Furniture, decor, these types of items, these are non-branded items where people ... want to own unique items, so they don't want to own the same exact items as everyone else. So, the way you shop for them, it's very visual in nature," Mr. Shah said.
"That nature doesn't lend itself to ... keyword search," he said. "All of a sudden the visual merchandising you would need and the way a customer discovers what they want is different, and then the fulfillment and delivery is different."
Shipping and the associated costs are a major issue when it comes to the profitability of furniture and appliance retailing whether online or off. Wayfair, the Journal reports, offers free shipping on orders over $49. Delivery times can be one to two days or weeks depending on the item purchased. Amazon offers free shipping on products it inventories to Prime members for purchases of at least $25. Items sold by sellers on its marketplace may have extra costs added for shipping.