What's even worse is that once Amazon collects enough data they'll be able to compete more effectively with these retailers and eventually kill them.

Yeah, this is essentially outsourcing the part that's hard for Amazon to do -- operating a retail store -- but allows Amazon to benefit from all that sweet, sweet data.

And as you point out, any time Amazon strikes up a "partnership" with outside parties, its ultimate goal is to conquer or cannibalize them.

Businesses should approach partnerships with Amazon with the same level of skepticism/trepidation as Native Americans signing a treaty with the U.S. government 150-200 years ago.

judging by the fact that tens of thousands of companies sell their products through amazon, especially FBA, I think the answer is a resounding yes

These are not new issues.

Retailers already rely on the trust of dozens if not hundreds of vendors for operations. Trust is established through contractual obligations, pilot programs, etc.

Shrinkage in the US is about 1.38% on average currently. Any competent retailer would run a pilot and evaluate its effect on shrinkage rates.

I'm also referring to trusting amazon specifically. They're a competitor, and not one known for playing nice. I've heard that retailers are hesitant to even use AWS (I don't have a source for that and would love to hear otherwise if that's the case?) - because of competitive concerns- so will people want to work with amazon for something so core to their business?

> I've heard that retailers are hesitant to even use AWS (I don't have a source for that and would love to hear otherwise if that's the case?) -

https://www.wsj.com/articles/wal-mart-to-vendors-get-off-ama...

Oh wow so that's worse than I had heard - not just avoid AWS but also force suppliers off of AWS.

Yeah, I wonder how retailers are going to feel about amazon having a direct pipeline of purchase data at all their competitors fed directly to a division of the company that I'm sure they'll claim is sealed off from the rest of operations. Even if amazon is playing totally fairly here, I don't see why it makes sense for people to trust them with so much at risk

But Amazon is a completely different beast - they've already shown they want to horizontally expand into the grocery market everywhere, so stores using their technology is just a stopgap on the journey to Amazon cutting into the profits of said stores via competition. When that happens, they better hope removing Amazon's system is as easy as it is to integrate it.

It might be slow for larger retailers, but I could imagine small independent "hipster" type shops opening up using this (people with the same mentality as the "no cash" bars/restaurants)