The shipping costs are hidden in the price. They have to use the words "free shipping" to make the purchase more appealing.
A printed t-shirt costs them $4, shipping costs $4, another $1 for "overhead costs". They make a grand profit of $1.
Profit is profit in this world, $1 times a billion transactions is a billion dollars.
I understand that, but if they have been able to show any kind of profit at all, it will have been at least partly due to shippers like USPS shipping for them at a loss, and UPS shipping for them at an extremely thin margin, if any. Amazon thinks they can control their shipping costs by starting their own service, all that means is they will be cutting out the other companies who have been eating a loss for them. Everyone thinks UPS is doomed, maybe, but it isn't due to Amazon shipping.
I agree. Could the end goal be to simply shut down local brick & mortar stores forcing consumers to shop online exclusively?
If you've followed what's been happening, you'd know that many of the brick and mortar stores have finally gotten their heads out their butts and are starting to put the pressure on Amazon for online sales. Amazon is starting to realize they need physical locations for people to go and pick up their orders as part of their strategy to get stuff to people as fast as possible. The problem is, the brick and mortars figured that out too, and they are already way ahead in that aspect. So, no, Amazon is not as dominant as everyone seems to believe. They have their competitors, and they are feeling the squeeze.