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

To: Robohogs who wrote (4169)	5/10/1998 6:11:00 PM
From: Bilow	Respond to of 164687

Hi Jonathan Robinson; I can't imagine it costs much to keep a book warm, given that you have a whole building filled with them. :) About that statement the yahoo guy made about BKS taking books on consignment, and therefore having a higher cost than AMZN. This is poppycock. BKS has a much better gross profit on books than AMZN, and historically has improved its margins while AMZN has historically reduced theirs. (Their most recent filing maybe shows a change in this bad trend.) In addition, nobody is talking about how fast AMZN's inventory has been increasing. This is necessary, in order to reduce time to customer. Relying on the publisher to drop ship books means that your customer satisfaction is in the hands of another company. In addition, the other company charges you a premium for this service, which is at least partly why AMZN's gross margins have been so much less than BKS's. The trend at AMZN is to go away from the "Just in time" B.S. that filled this thread a year ago. JIT was never a technique for a commodity retailer, as a company is unable to predict in advance how many books it needs. So eventually AMZN ends up with big warehouses in order to improve gross margins. Why not hang a retail sign on the outside, and sell to the local customers? Then you have a company just like BKS, with exactly the same bricks and mortar. Except your financial situation is dire. -- Carl

To: Robohogs who wrote (4169)	5/10/1998 10:45:00 PM
From: Glenn D. Rudolph	Respond to of 164687

But those costs of heating, etc. are still less per book sold than are the shipping costs associated with any of the web retailers. this is the forgotten point. Jonathan, There is even a further part of the equation. Every order though AMZN bust be looked at by a person, the book picked from the shelf or ordered from Ingrams and then packed in a box with a mailing label. Lots of man power here. BKS can have some stock personnel stock the shelved with 20 copies of each book as the day goes on. The customer comes in and peruses the shelves. The customer chooses a book or more than one and takes it to the cash register where the cashier takes the money and places the book in a bag. No boxing, shipping label, etc. Also, there is the friendly personal thank you. Glenn