Amazon dismisses report of plans to open physical stores as 'rumors and speculation'

E-commerce giant Amazon dubbed reports of plans to open physical stores in the US that resemble the brick-and-mortar department store models as "rumors and speculation."

Amazon will supposedly open its first US stores in Ohio and California.

The stores are expected to be roughly 30,000 square feet, less than a third of the size of traditional department stores built by the likes of Sears and J.C. Penney that it's helping to crush.

The Amazon physical stores will offer clothing, household items, electronics, and other merchandise, with its in-house brands expected to be featured prominently.

Retail analysts see Amazon's plan to venture into departments stores as a lower-stakes commitment than buying a big chain like Kohl's, and as a way to experiment and learn from a new format.

A brick-and-mortar presence in areas like apparel would help Amazon reach customers who prefer to try on clothes and see other goods before buying them while spurring the growth of its private labels.

These stores would also give Amazon locations where customers could return products they purchased online and serve as warehouses to ship goods to shoppers' homes faster.

A risk for Amazon is its lack of experience in running department stores.