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Technology Stocks : Amazon.com, Inc. (AMZN) -- Ignore unavailable to you. Want to Upgrade?

To: Killswitch who wrote (106212)	7/17/2000 3:04:39 AM
From: Eric Wells	Read Replies (1) \| Respond to of 164684

I'm curious, if Amazon got into the distribution business by buying WBVN for instance, would that make them much more valuable in your view? Brian - in my view, no - I do not think that Amazon acquiring Web Van and getting there local grocery distribution centers would be of help to Amazon. Why? A couple of reasons: 1. I'm not convinced that Web Van is going to make it. It seems that the other two major online grocery deliver business have had a hard time (Pea Pod, which has been trying for a couple of years now, and HomeGrocer, which was recently acquired by Web Van). Certainly there is a benefit to some people to be able to order groceries online, but I don't see any trend of fewer people shopping at the local supermarket. I'm not sure the economics of the Web Van model make the business viable. And it seems that Web Van may run into it's own cash problems at some point soon. 2. Web Van's distribution centers are fundamentally different from those used and required by Amazon. Web Van essentially needs a major grocery distribution center in every metropolitan area in which they operate (those vegetables and dairy products have to be fresh). I suppose Amazon could attempt to rely less on Federal Express and move books and other goods from their regional centers to Web Van local centers - to have such goods utimately delivered by Web Van delivery trucks. But such movement of good might actually be more costly than just having them shipped form Amazon regional centers directly to customers. I can't see Amazon making a move to buy Web Van any time soon - doing so would only put the company in position of draining its cash reserves at a faster pace - and I think it would also server to dilute Amazon's brand. But one can never second guess Amazon when it comes to acquisitions. Thanks, -Eric