Microeconomic Cast Studies

Question 1

What percentage of global e-commerce sales among the Top 2000 retailers is Amazon projected to have in 2024?

Answer 1

39.7%

(Digital Commerce 360)

Question 2

What is the projected percentage of US retail e-commerce sales for Amazon in 2025?

Answer 2

40.4% (approximately $491.65 billion)

(Elite Accounting Firm | Upcounting)

Question 3

What is Amazon’s share of the US e-commerce market in 2024?

Answer 3

38%

(Wikipedia)

Question 4

What are the total web sales for Amazon in 2024?

Answer 4

$448.64 billion—over three times Walmart’s $123.20 billion

(Digital Commerce 360)

Question 5

How many robots are projected to be deployed in Amazon’s fulfilment centres by mid-2024?

Answer 5

> 750,000 robots

(Tomorrow’s World Today®)

Question 6

What was the growth in the number of robots at Amazon from 2021 to 2023?

Answer 6

Growth from 350,000 robots in 2021 to 750,000 in 2023, more than doubling in two years

(X (formerly Twitter))

Question 7

How many robots process shipments in Amazon’s largest US warehouse?

Answer 7

> 7,000 robots process up to one million shipments/day

(AGV Network)

Question 8

What is the capability of the Vulcan robot in terms of order processing?

Answer 8

The Vulcan robot has processed > 500,000 orders and can handle 75% of items by touch

(The Verge)

Question 9

What percentage of US retail e-commerce is Amazon forecasted to account for by 2025?

Answer 9

40.9%

(Contimod)

Question 10

What percentage of total US retail sales is Amazon expected to represent in 2024?

Answer 10

6.6%

(Contimod)

Question 11

When is Amazon predicted to surpass Walmart as the largest US retailer by overall sales dollars?

Answer 11

By 2024

(plma.com)

Question 12

What is the market share of Tesco?

Answer 12

Tesco has a market share of approximately 27%.

Source: Kantar, 2024–2025

Question 13

What is the combined market share of the Big Four supermarkets?

Answer 13

The Big Four (Tesco, Sainsbury’s, Asda, Morrisons) have a combined market share of approximately 60–65%.

Source: Kantar, 2024–2025

Question 14

What pricing strategy do Tesco and Sainsbury’s use?

Answer 14

Tesco and Sainsbury’s use price matching against Aldi and Lidl.

Question 15

What are some examples of non-price competition in the supermarket industry?

Answer 15

Examples include Clubcard Prices, Nectar Prices, and delivery subscriptions.

Question 16

What is the typical net profit margin for supermarkets?

Answer 16

Supermarkets typically operate on thin margins of around 2–4% net profit.

Question 17

What strategy do supermarkets rely on due to thin profit margins?

Answer 17

They rely on high volume, low margin strategies.

Question 18

What are some barriers to entry in the supermarket industry?

Answer 18

High sunk costs, economies of scale, and branding are significant barriers to entry.

Question 19

How did discount retailers like Aldi and Lidl enter the market?

Answer 19

They simplified product ranges to break into the market.

Question 20

How many people does Tesco employ in the UK?

Answer 20

Tesco employs approximately 300,000 people in the UK.

Question 21

What type of wage employer is Tesco?

Answer 21

Tesco is a minimum/living wage employer for many staff.

Question 22

What is the price sensitivity of grocery demand?

Answer 22

Demand for groceries is highly elastic due to price sensitivity.

Question 23

What consumer behavior is observed during inflation in the grocery sector?

Answer 23

Consumers tend to switch to own-brand or discount stores during inflation.

Question 24

What type of investment have Tesco and Sainsbury’s made in technology?

Answer 24

They have heavily invested in Ocado-style delivery systems.

Question 25

What technology reduces costs and reliance on labor in supermarkets?

Answer 25

Automation and self-checkout systems help reduce costs and labor reliance.

Question 26

What was the outcome of the CMA's review of the Sainsbury’s–Asda merger?

Answer 26

The CMA blocked the merger due to fears of reduced competition and higher prices.

Question 27

What impact does Vulcan have on productivity and efficiency?

Answer 27

Vulcan increases labour productivity by automating repetitive tasks and improving storage accuracy. ## Footnote Moves Amazon closer to productive efficiency, reducing average costs (AC) in the long run.

Question 28

What are the labour market effects of Vulcan?

Answer 28

There is a risk of job displacement in low-skilled roles, but job creation occurs in higher-skilled areas such as robot maintenance and AI training. ## Footnote Structural unemployment may rise short-term, but is offset by retraining programmes.

Question 29

How does Vulcan affect cost structures?

Answer 29

Automation like Vulcan reduces variable costs (e.g. wage bills) while increasing fixed costs (tech investment). ## Footnote Encourages dynamic efficiency as Amazon invests in innovation.

Question 30

What is the market structure impact of Vulcan?

Answer 30

Amazon strengthens its position in the oligopolistic e-commerce market. ## Footnote Use of Vulcan may create barriers to entry for smaller firms lacking capital for such tech.

Question 31

What are the positive externalities of Vulcan?

Answer 31

Improved worker safety reduces healthcare costs and workplace injuries. ## Footnote This is a positive externality in production.

Question 32

What are the negative externalities of Vulcan?

Answer 32

There is potential for increased energy use or tech waste if not managed sustainably.