Just about everything I purchase these days is cheaper at a local store. Ritter Sport chocolate bars are cheaper, bike tubes and tires, pots and pans... I can't think of a single thing that I have price-checked recently that has been even slightly cheaper on Amazon.
They're not putting anyone out of business through predatory pricing.
They are incredibly competent though. I ordered an iPad from Target, and it was like ordering from LL Bean in 1987. I think FedEx Ground dispatched it by horse, it took 11 days to travel from St Louis to NYS.
Source: I work for an online retailer.
In my particular case it was FedEx/Smartpost. In my area, the USPS leg has been very reliable, 100% next day delivery from drop off at their Springfield, MA center to my door in Albany NY.
The FedEx Ground leg took forever, my little box made like 4 stops in Ohio and PA before hitting the post office in MA.
UPS typically does that in 2-3 days, USPS typically 3.
They even delivered on sundays this year, which is pretty much unheard of in Austria.
The author has revised his thesis (Q4 2015) [0], though he remains bearish on AMZN longterm.
[0] http://www.vox.com/2015/12/9/9873174/amazon-never-profitable
Amazon has not, historically, been a profitable company because Amazon's leaders don't want it to be a profitable company. In the future it will continue to not be profitable for the exact same reason. In the past, Amazon has managed to turn a profit when it's forced to by skepticism from Wall Street, which suggests that non-profitability is a choice.
Indeed, it's a choice that CEO Jeff Bezos has explained to the public in response to a joke I once made about the company's unprofitability:
and
Fundamentally, Amazon will only start booking large consistent profits when the company's leaders run out of new ideas to invest in. Right now they are not out of ideas, as you can easily tell from the wide range of businesses they are halfway into.
His thesis that AMZN's an investor funded charity has been blown up via the gains accrued by investors. Despite being wrong, I admire his analysis as insightful and true to value investing principles.
In the '15 article, he changed his thesis to account for AWS' unexpected rise and earnings contributions and said his thesis fails if AMZN doesn't run out of profitable investment ops. I submit that's the key change. Despite being overall bearish, that's walking it back quite a bit.
FWIW, since 12/9/15 (Vox), AMZN's up 26%.
- He wrote Slate's economics column, "MoneyBox," for a number of years.
- He wrote a book about the economics of the housing market.
- He co-founded Vox.com, which -- presumably -- reinvests its profits to grow the business.
I'll add that his writing was good enough to trigger a response from Bezos in a letter to shareholders.
> That's because Amazon, as best I can tell, is a charitable organization being run by elements of the investment community for the benefit of consumers. The shareholders put up the equity, and instead of owning a claim on a steady stream of fat profits, they get a claim on a mighty engine of consumer surplus. Amazon sells things to people at prices that seem impossible because it actually is impossible to make money that way. And the competitive pressure of needing to square off against Amazon cuts profit margins at other companies, thus benefiting people who don't even buy anything from Amazon.