From the home history web page of Sears:
By the time Sears was started, farmers in rural America were selling their
crops for cash and buying what they needed from rural general stores. But
when they laid their money on the line for goods, farmers saw red. In 1891
the wholesale price of a barrel of flour was reported to be $3.47. Price at
retail was at least $7, a 100 percent increase. Farmers formed protest
movements, such as the Grange, to do battle against high prices and the
"middleman."
Sears, Roebuck and Co. and other mail-order companies were the answer to
farmers' prayers. Thanks to volume buying, to the railroads and post office,
and later to rural free delivery and parcel post, they offered a happy
alternative to the high-priced rural stores. Years later the company adopted
the motto "Shop at Sears and Save." Because farmers could do so in the
1890s, Sears prospered.
John,
Let's talk about innovation. It appears Sears was quite profitable and well on their way to succes by the 1890. That was 108 years ago. Sears' method of selling was to distribute catalogues to customers and and take orders via parcel post. The products were then shipped via US Mail to the customer from the Sears wharehouse or dropshipped from the factory in the event the product was not an item Sears stocked.
Sears was successful because they had almost no competition and were the best in price at their time. Amazon lives in a digital world. They took their catalogue and placed it online so it would not need mailed. Orders are taken online and shipped from Amazon's wharehouse or dropshipped if the product is not stocked. There are very few differences between Amazon and Sears in 1890. Amazon has a choice of delivery methods such as UPS, Airborne Express, US Mail, etc. Orders requests need not be mailed. The differences are few and here they are. Amazon has competition and lots of it. They cannot undercut the competition and turn a profit as did Sears. Secondly, Amazon is losing money making it more difficult to compete.
I am not too impressed with the inovations Amazon has made in 128 years. The time from order to delivery is faster but that is not due to Amazon. That is due strictly to faster delivery and order methods that are available to all companies. The competition also has fast delivery. I am still looking for inovation from Amazon from 108 years ago retailing. The only difference I see is that Amazon is able to milk their investors for operating capital while they are losing money. Investors would not throw money into Sears in 1890 had they been losing money.
Glenn |
