One thing history has shown us is that as technology advances, more and more companies will be faced with disruption.
The development of new technologies and business models has the potential to make existing ones redundant, putting entire businesses at risk.
I don't believe it will be any different in 2017, with several companies likely to come face to face with disruption.
Online retailer Kogan.com Ltd (ASX: KGN) and JB Hi-Fi Limited (ASX: JBH) could come under pressure if the much-speculated arrival of US-giant Amazon on Australian soil eventuates.
I see Kogan as being especially vulnerable. Although its founder and CEO Ruslan Kogan has dismissed these concerns, I'm not as optimistic as he is. Amazon has a long history of crushing its online rivals and I wouldn't be surprised to see this continue.
Although Woolworths Limited (ASX: WOW) and Coles operator Wesfarmers Ltd (ASX: WES) may see a slight drop in sales if Amazon launches its groceries business, I think it will be some time before it captures a meaningful share of the market from the two supermarket giants.
I would be more concerned about another rumoured arrival in the form of German discount retailer Lidl. If the arch rival of ALDI expands into Australia then not only do Coles and Woolies face market share losses, but the margin-crushing price wars could go up a gear.
Finally, the world's largest sporting goods retailer Decathlon launched its online Australian store earlier this year.
If the ALDI of the sporting goods market opens up physical stores in 2017 then it would be bad news for Super Retail Group Ltd (ASX: SUL), which derives approximately 37% of its revenue from its sporting goods segment.
Foolish takeaway
Whilst at this stage it is of course only speculation, I believe that it would be prudent for investors to keep a close eye on developments for each particular retailer.
Failure to do so could leave you with the equivalent of a Myer Holdings Ltd (ASX: MYR) in your portfolio. Its shares have fallen 49% in the last three years as it fights for relevance in a changing retail environment.
