Walmart eyes buyout of Amazon rival Jet.com

Retail giant Walmart is bent on beating Amazon’s domination of the e-commerce market, so much so that the world’s biggest company is currently in talks to buy out online discount retailer Jet.com.

The Wall Street Journal broke the news of the impending sale and reported that Jet.com’s purchase price could be as much as US$3 billion (AU$3.9 billion).

Neither Walmart nor Jet.com confirmed the news as of press time. But if a deal will be reached, Walmart’s buyout of Jet.com will boost its fighting chance to shake Amazon’s dominance on the US$350 billion (AU$459 billion) e-commerce market.

Launched on July 21, 2015, Jet.com was founded by Marc Lore and Nate Faust as an e-commerce startup that aspired to rival Amazon. Jet.com targets to have 15 million paying customer base and be worth US$40 billion (AU$52.6 billion) by 2020.

The news came as a surprise to industry watchers as Lore said in March that with Jet.com, “I basically see an opportunity to create a really large business over time in an online ecommerce market that's US$3 billion (AU$3.9 billion) today but growing to a trillion dollars over the next 10 years.”

But prior to launching Jet.com, Lore has already his earlier e-commerce ventures Diapers.com, which he sold to Amazon, and ThePit.com, which he sold to Topps.

Like Amazon Prime, Jet.com used to charge US$50 (AU$65.7) annual subscription to customers. For this annual fee, customers can get access to goods that are 10 to 15 percent cheaper than those purchased elsewhere on the web. But in October Jet.com dropped its membership fee.

When it started operation, Jet.com reportedly had 4.5 million products for sale. According to WSJ, the company headquartered in Hoboken, New Jersey, raised US$350 million (AU$460 million) in venture capital in November 2015. Jet.com was reportedly valued at US$1.35 billion (AU$1.8 billion) at the end of 2015.

Despite the tough batte for e-commerce supremacy, Walmart remains the world's largest company in the past three years. As of the last fiscal year ending March 31, Walmart earned revenues worth US$482 billion (AU$646 billion).

Amazon only landed the 18th spot on the Fortune Global 500 list after raking in US$107 billion (AU$141 billion) in revenues during the scoring period.