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

To: Gary Walker who wrote (25031)	11/8/1998 5:30:00 AM
From: FR1	Read Replies (4) \| Respond to of 164684

At least they will have a source of distribution....hummm...surprised you haven't dumped this turkey yet.... If you really think this stock is so bad, why are you wasting your time on this thread? I'll answer for you: because you are a short seller and the only way you can make money is to try to panic people into dumping their stock. Everybody talks about how Barnes and Noble (BKS) is going to kick ass and have a great web site. Basically, in your words, it: Looks like another case of the big 'ol bad company kicking the droppings out of the little underdog upstart. Barnes and Noble has lots of problems. That's why investors in their stock, until a few weeks ago, *lost money for the last year. quote.yahoo.com BKS has plenty of problems to handle - here are a few: 1) The overhead and constant opening/closing of over a thousand stores. 2) Everybody in the bookselling industry is screaming at the feds about their merger. The American Booksellers Association says they will use all their resources to fight the merger. If the merger is allowed, there will be plenty of strings attached. 3) Barnes and Noble has spent the last 15 years alienating all but the largest publishers. Try calling Barnes and Noble and tell them you are a publisher and you have a book that is selling great. Tell them you will take any terms, net 210 or whatever they want, if they will just stock the book. Nope. They will tell you to go find a large distributor because they will not order from you directly. So you call Ingram. Sorry - we at Ingram don't want you. Ingram says you gotta go to a small press distributor who will take enormous discounts and then only on consignment. BKS has a lot of fences to mend and I don't see it happening any time soon. 4) Call the BKS on-line MIS people. I have. I'm glad I said people* and not person because the MIS director has changed each time I called. Its panic and chaos. Nobody knows what they are doing. Maybe they are starting to get it together now but not as of a month ago. Remember MSN! The web site that would kill AOL overnight! Put together by the leading experts in the industry! Hooked into every copy of Windows! 5) Ever go into a Barnes and Noble bookstore? It's wall-to-wall books and there is a invoice on somebody's desk for every copy. Multiply that by a thousand. The books can be returned but if you are ordering in 2's and 3's it usually costs you (BKS) more to return the book then to write it off and put it on fire sale. Yes, BKS is responsible for paying postage to the store and then again for the return trip to the publisher. Providing, of course, that the book is not read by customers or dinged up (in which case BKS pays for another trip back to the store for the refused return). Amazon has its problems but they are moving in the right direction. One thing I am shocked Amazon has not done is consinee shipping. Somebody tell them! Basically, online businesses are closest to Library Distributors in nature. They take and fulfill single copy orders at a 20% discount. All the library distributors and major chains figured out some time ago that the big loss is in shipping charges. If a publisher is told to ship a order to Amazon and no other advice is given, the publisher will always mark up the shipping to make some profit. Consinee shipping kill this problem dead. Publishers are told to ship books "collect" (actually called "consinee" shipping) to the library distributor or chain bookstore by UPS or RPS. Then the library distributor or chain bookstore negotiates a special shipping deal with UPS or RPS. Why Amazon has not caught on to this by now is baffling. One thing Amazon is doing right is the Advantage program where Amazon acts as a consignment distributor at 55% discount. They really ought to put a lot of people on that project because it is a great money maker. By contrast, Barnes and Noble gets 45% discount net 30 from distributors and Publishers. Plus they have to stock it in a zillion stores. Plus the returns, etc.