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The Laws of Business Don't Seem to Aplply to Amazon
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<blockquote data-quote="East coast navy" data-source="post: 1215003" data-attributes="member: 46214"><p>Here is the reason why Amazon does so well. All the product is the same as what all their competitors sell. They pay more for it then their competitors pay. Also they can sell it cheaper.</p><p></p><p>They can do this for two reasons. </p><p></p><p>First, if it cost $3 to make a product and a store buys it for $5 then it's sold in the store for $20 dollars. You just made a 300% profit. That's why you see sales all the time because they still will make a 120% to 200% profit. Then customers say how can they stay in business. </p><p></p><p>Amazon does it better then this. They will buy the product for $7 and sell it for $18. Which brings in more customers. Then offer free shipping because it cost them almost nothing because they are one of UPSes biggest customers and get a good rate. </p><p></p><p>Second, Amazon does what most of what their competitors do not. They sell online with out having a store front. You look at all their competitors and they have 200,000 to 500,000 employees where Amazon has 97,000. </p><p></p><p>This is is why the can stay competitive while having a low margin.</p></blockquote><p></p>
[QUOTE="East coast navy, post: 1215003, member: 46214"] Here is the reason why Amazon does so well. All the product is the same as what all their competitors sell. They pay more for it then their competitors pay. Also they can sell it cheaper. They can do this for two reasons. First, if it cost $3 to make a product and a store buys it for $5 then it's sold in the store for $20 dollars. You just made a 300% profit. That's why you see sales all the time because they still will make a 120% to 200% profit. Then customers say how can they stay in business. Amazon does it better then this. They will buy the product for $7 and sell it for $18. Which brings in more customers. Then offer free shipping because it cost them almost nothing because they are one of UPSes biggest customers and get a good rate. Second, Amazon does what most of what their competitors do not. They sell online with out having a store front. You look at all their competitors and they have 200,000 to 500,000 employees where Amazon has 97,000. This is is why the can stay competitive while having a low margin. [/QUOTE]
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