CSP: What is the likelihood that Amazon will actually move in to brick and mortar, especially after building its reputation on dismissing the need for physical stores?
O’Shea: After being the “anti-brick-and-mortar” retailer for so many years, I think it might be tough for Amazon to all of a sudden shift gears and try to go brick and mortar in a meaningful way. In addition, we believe that Amazon does not “distribute” in any meaningful way, which we define as controlling the last mile [i.e., getting product in the consumers' hands via proprietary means, but “fulfills,” meaning it has outsourced the last mile to UPS, Fedex, the U.S. Postal Service and other carriers.]
To go full-bore into brick and mortar, Amazon would need to develop a completely new capability, which would not happen overnight. Further, we do not believe food delivery, except in certain very limited locations, is scalable for the foreseeable future in the United States.