Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: Harry Simpson who wrote (1217)	1/17/1998 10:11:00 AM
From: John May	Read Replies (3) \| Respond to of 164684

Harry, come on! Four against one's not fair. I'll take on Candle, Bob and Don, but you're the final straw. It seems to me we're debating something unanswerable. In my post to Candle I said the BKS is fighting a two-front war. They have incredible resources (pockets); that's true. But how much of those resources are they going to throw at the Internet? Granted, a significant amount; they want to succeed in this important new medium. But they're already deeply entrenched in a vicious retail battle with BGP that requires heavy investment in inventory, labor, building and equipment. BKS and BGP are nearly the same size. The both have just under $1 billion in inventory. For BKS this represents 54.8% of their total assets; for BGP inventory is 60.9% of total assets. On 9/30/97 AMZN had less than $3 million in inventory, 4.8% of its total assets. How can this be? It must signal that Internet commerce represents a paradigm shift in retailing that renders traditional ratios (inventory to total assets; building & equipment to total assets) moot. AMZN is commited 100% to Internet commerce. BKS is no doubt commited, but not 100% - it's not their fault, they have no choice; therefore, in the Internet arena, AMZN's pockets are probably deep enough to maintain their market-share leadership position. BKS has already said their goal for 1998 is $100 million in Internet revenues. Based on its growth curve, AMZN should do more than double that, and they will lose a lot of money, but not so much, as Candle predicted, that they will falter and go under. That's wishful thinking. John Anyone want to take bets on the Carolina/Duke game on 2/4?