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Technology Stocks : BEST INTERNET STOCKS TO OWN IN 1999 -- Ignore unavailable to you. Want to Upgrade?

To: JOHN CHEN who wrote (326)	4/17/1999 8:03:00 PM
From: Jing Qian	Read Replies (1) \| Respond to of 471

Retail margin is razor thin... 1) But online Retail margin is way better than off line Retail margin. Wal-Mart's margin is 3%. I believe AMZN can achieve at least double the margin than Wal-Mart. Right now AMZN is on the ramp-up stage, they are recycling all their earnings to advertising and expansion. So the higher margin AMZN actually is making doesn't show obviously. However, after AMZN reached a certain critical mass of sale's revenue, the advantage in margin will pay off for AMZN. Yes, the margin is thin, the if you win, you still win big by volumes. 2) AMZN is not a pure retail store. It's aggressively getting into high margin auction market. This move allows AMZN to compete head to head with eBay. It's not inconceivable that AMZN will eventually overtake eBay's dominant position. At that time, AMZN will have better potential than eBay's. AMZN can leverage both retail traffic and auction traffic, seamlessly integrating the two businesses and generate more momentum. 3) DELL, CPQ currently are not selling on AMZN. However, if AMZN can prove itself. There is no reason why DELL and CPQ refuse to go through AMZN and let AMZN make a commission. In this business, all that matters is traffic. If a site can sustain millions of page views per day, all company will go there to setup shops. Proctor Gamble simply can't setup a web site that can attract more page views than AMZN does, so Proctor Gamble will eventually give up their own site and sell their lotions and Baby wipes on AMZN. Same applied to Pfier, Gap, Men's warehouse and Calvin Klein, they will also come to AMZN eventually. The best payoff date for AMZN is not right now, it will be 3-4 years from now. All merchants want to care are to sell their products in the shortest time possible. If they can't do it themselves, they will find someone who can, and pay a little due. Eventually, they will all come to AMZN. 4) AMZN can afford mark down more because of low overhead. So you will always find less expensive products on AMZN than on Wal-Mart's shelves. Yet, AMZN retains the same or higher margin because of savings in overhead. 5) AMZN is the most aggressive Internet company that I have ever seen. Much more aggressive than EBAY and YHOO. AMZN always give me surprises, good surprises. I am waiting for AMZN to get into more lucrative and high margin businesses, such as business to business auction. Fixed-price auction for small retails. One should not put all their money in AMZN, but one can't afford not to. It will prove to be too expensive for opportunity lost.