analyze the finance international risk of Amazon

At least 2 pages

Our group will be conducting an analysis on Amazon’s international growth strategy and

presenting our findings through a company report.

Situation Overview

Amazon is focused on becoming the world’s most dominant e-commerce business. On the February quarter earnings call Jeff Bezos announced a $5b investment in India and released details about a plan to double Amazon’s operations in China. While Amazon has seen explosive growth across the globe, domestic sales have consistently grown at a faster clip than emerging markets sales. In FY’17, Amazon generated 60% of its revenues domestically and 40% outside of North American borders. This is an issue for Amazon as the company is injecting billions of dollars into foreign markets but not seeing a high return on investment. In fact, most of Amazon’s international losses were due to heavy competition. FlipKart, (backed by investors such as Softbank, Tencent, eBay, Microsoft, and Walmart) is aggressively fighting for market share in India. In the Chinese market, Amazon faces even tougher competition with Jack Ma’s e- commerce giant Alibaba. Both businesses host very similar service offerings; brick-and-mortar retail, cloud services, and a massive catalog of e-commerce products. Coupled with strong competition, a potential trade-war between the United States and China could make this metaphoric “cold war” even more interesting. Our report will focus on Amazon’s competition in international markets (mainly India and China) as well as the potential impacts of a trade-war on the company’s growth strategy.