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: KeepItSimple who wrote (42395)	2/24/1999 11:22:00 PM
From: Lizzie Tudor	Read Replies (1) \| Respond to of 164684

Here we go again. Let's start pepsi.com. Now, we have a commodity item that has a reasonably high profit margin. However, can we ship this product to consumers directly? No- the damn stuff WEIGHS too much. The only way to make a profit and not charge 5 dollars per bottle is to ship the stuff in 10 ton trucks to stores, and let the CUSTOMER do the fulfilment and "final-mile" shipping. Glenn understands this. William does not. OK so the whole problem here is pepsi "weighs too much"? Your arguments are the exact same arguments we heard when we started directly selling 50-100lb monitors to consumers with razor thin profit margins. The logistics costs of maintaining multiple regional warehouses, storage and transporation charges finally down to the local outlet exceeds the central warehouse direct to consumer. The reason shipping charges are high now is because the business model for shipping has not been challenged yet, but that is in the process of changing so shipping charges are coming down too. Having said all this, groceries being an impulse buy may never be dominated by the online channel. Edit: I see the prior post says this also, I agree food may not be ideal, home delivery has its place though.