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AmazonLocal-standard-jpgAmazon is preparing to launch a local marketplace that could compete with Yelp, Angie’s List, or even home improvement businesses, like Home Depot and Lowe’s, according to a Reuters report today.

Sources told Reuters that the marketplace could encompass anything from babysitters to handymen. Amazon declined to comment to Reuters, which referenced several unnamed sources familiar with the deal. An Amazon spokeswoman also declined to comment for this story.

Reuters’ report suggests that Amazon will begin to roll out the marketplace this year in one market at a time similar to its approach to delivering groceries.

This is not Amazon’s only attempt to serve the local market. It has experimented with offering local services through a close partnership with LivingSocial, a company it invested in years ago. While that investment has not worked out financially, it did give the online retailer a start at entering the daily deals space back when the market was dominated by Groupon.

That business is still mostly dominated by spa, restaurant and travel coupons, but you could easily see how it could morph into more. One example Reuters gives is Amazon recently offering installation services to users who bought Nest thermostats.

Amazon’s CEO Jeff Bezos is also an investor in Pro.com, which is on a mission to help home owners find, book and schedule home improvement professionals. It was founded by former Digg CEO Matt Williams, and is base in Seattle near Amazon’s South Lake Union headquarters.

Amazon’s online business model has often drawn criticism from local merchants, who claim that the e-commerce giant is training shoppers to find cheap deals online instead of supporting nearby retailers. If that’s the case, Amazon’s push into local will not be a slam dunk. However, if Amazon’s local marketplace is able to drive customers to local businesses, perhaps this is the olive branch that local retailers have been looking for?

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