Brooklyn shopkeepers test a service to fill in Amazon’s gaps

Bloomberg

With Amazon.com Inc. hitting a trillion-dollar valuation earlier this week, the company’s shadow looms over the entire retail industry.
But there are still sizable gaps that Amazon and other online giants don’t address, and that’s where Peter Price looks to build a business. The 78-year-old entrepreneur is seeking out mom-and-pop shops — like the local butcher, toy store or pharmacy — and trying to outfit them with e-commerce capabilities, including next-day delivery.
The endeavour is called EMain, and he’s been laying the groundwork in the Park Slope neighborhood of Brooklyn in recent months. The former media executive has been visiting shops, shaking hands with store owners and pitching his idea. On September 20, he aims to roll out a 12-week trial of the service for Park Slope with 60 businesses. If that goes well, a nationwide debut could follow.
“I really believe it will resonate on main streets around the country,” said Price, whose career has spanned advertising, newspapers and television. He previously served as president of Liberty Cable, where he fought a similar block-to-block fight to encourage New Yorkers to adopt the service.
He also was chief executive officer of the National Academy of Television Arts & Sciences and helped then-New York Mayor Michael Bloomberg map out the city’s digital media strategy.

Next-Day Delivery
With EMain, local shops will be able to showcase their offers online, with the promise of free next-day delivery for local customers. The shops would eventually pay a small weekly subscription fee of $50 to $100 for the service. With 30 million small businesses in the US as potential customers, Price thinks he can build a $6 billion business.
The ace up Price’s sleeve is an agreement with the Postal Service, which will pick up goods from the shops and deliver them to local consumers the next day. EMain also plans to work with local chambers of commerce to encourage small businesses to join his effort.
“If successful, EMain’s model will not only help small businesses to better connect with their communities, but also help to support local post offices across the country,” said Stephen Schwarzman, CEO of Blackstone Group LP, who isn’t an investor in the project but has been briefed on it.
The idea is that shops will use the service — not just to generate e-commerce orders — but to drive store traffic.

Groupon’s Woes
It’s not a slam-dunk proposition. Groupon Inc. has tried to carve out a niche in local e-commerce — with mixed results. The once-hot coupon service has struggled to maintain sales growth in recent years. After years of adjusting its business model, the company is now the subject of takeover speculation.
Small businesses often face tight margins and the threat of rent increases, so there’s not much money to go around. There’s also the problem of getting the attention of consumers, said Peter Krasilovsky, a consultant whose firm helps small businesses handle e-commerce.
“The challenge with building local marketplaces is to get enough people to look — local is incredibly fragmented,” he said.