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It's obviously not a perfect metaphor, but neither is a grocery store. >Amazon gives you distribution, traffic, logistics, etc, with zero risk. Not everyone u

It's obviously not a perfect metaphor, but neither is a grocery store. >Amazon gives you distribution, traffic, logistics, etc, with zero risk. Not everyone uses the distribution, and a mall or flea market also provides traffic to tenants.

tracer4201 7y ago
At a mall you pay a fixed cost in terms of rent, regardless of sales. Amazon doesn’t charge you to simply list your product, right? If vendors were being charged a fee just for the listing itself without any sales, your argument would be more valid. If amazon does charge a fee for simply listing a product, tell us. They don’t as far as I know.
- learc83 7y ago
  No analogy is perfect. Amazon obviously isn't a mall, but it's not a grocery store either. A grocery store owns the goods in their possession even if they have agreements for sellers to buy some unsold product back. Amazon does not own the 3rd party goods in their possession.
  - tracer4201 7y ago
    You’re dismissing the mall call by saying no analogy is perfect since it doesn’t work for your argument but then you’re comparing against grocery stores, which is a pretty gross simplification. Amazon isn’t a grocery store. The majority of their catalog isn’t even available at most grocery stores, maybe excluding WalMart. My family owned several convenience stores growing up. Some products were bought and it was your problem to move them off shelves. Some were displayed on shelves and you only paid for what was actually sold. This was common with one of the distributors who gave us Frito Lay products. Other products had strict terms - for instance, Pepsi and Coke distributors wouldn’t give you competitive pricing unless you agreed to purchase Y in X quantity, place their mini coolers next to the refrigerator, place signage within x feet, clearly visible from the front entrance, etc. suddenly, you’re the only store in town who sells 16 oz soda for $1.59 just to break even while everyone else is selling the same soda for $1.09 or just 99 cents. It’s a different model than Amazon and you’re taking liberties to simplify it
    - subhro 7y ago
      Really curious. How are the other guys selling for $0.99, if they didn’t get the competitive pricing? (Presumably because they didn’t go through the sign within X feet antics)
      - tracer4201 7y ago
        They did get competitive pricing, but they have a lot more wiggle room because they’re a giant company with far more revenue, marketing, and branding than a couple ma and pa stores. These distributors may or may not have the exact same terms, but at the end of the day, these other corporate stores had enough foot traffic that provided them ammo to help define their own terms. You just didn’t have that leverage as a smaller shop.
    - learc83 7y ago
      > You’re dismissing the mall call by saying no analogy is perfect since it doesn’t work for your argument but then you’re comparing against grocery stores, which is a pretty gross simplification. No I'm saying it has very important distinctions that make the grocery store analogy inappropriate and that the mall or flea market analogy is closer in some respects, but not all. >Amazon isn’t a grocery store. The majority of their catalog isn’t even available at most grocery stores, maybe excluding WalMart. Of course it's not. That's a big part of my original point. > Some were displayed on shelves and you only paid for what was actually sold. My dad worked for Lance (and frito lay for a while). I could be wrong and you could have had a very unusual distributor. But my guess is you misunderstood what was happening. Companies do sometimes offer buyback guarantees and you might even be able to buy items on credit, so that it appears you're only paying for what sells, but that's not actually how it works. Those items are the property of the store while they are on the shelf.
- scarface74 7y ago
  Some leases do require you to pay a percentage of sells... https://www.nolo.com/legal-encyclopedia/clb-percentage-rent.html https://www.nolo.com/legal-encyclopedia/clb-percentage-rent....

tracer4201 7y ago

At a mall you pay a fixed cost in terms of rent, regardless of sales. Amazon doesn’t charge you to simply list your product, right? If vendors were being charged a fee just for the listing itself without any sales, your argument would be more valid. If amazon does charge a fee for simply listing a product, tell us. They don’t as far as I know.

learc83 7y ago
No analogy is perfect. Amazon obviously isn't a mall, but it's not a grocery store either. A grocery store owns the goods in their possession even if they have agreements for sellers to buy some unsold product back. Amazon does not own the 3rd party goods in their possession.
- tracer4201 7y ago
  You’re dismissing the mall call by saying no analogy is perfect since it doesn’t work for your argument but then you’re comparing against grocery stores, which is a pretty gross simplification. Amazon isn’t a grocery store. The majority of their catalog isn’t even available at most grocery stores, maybe excluding WalMart. My family owned several convenience stores growing up. Some products were bought and it was your problem to move them off shelves. Some were displayed on shelves and you only paid for what was actually sold. This was common with one of the distributors who gave us Frito Lay products. Other products had strict terms - for instance, Pepsi and Coke distributors wouldn’t give you competitive pricing unless you agreed to purchase Y in X quantity, place their mini coolers next to the refrigerator, place signage within x feet, clearly visible from the front entrance, etc. suddenly, you’re the only store in town who sells 16 oz soda for $1.59 just to break even while everyone else is selling the same soda for $1.09 or just 99 cents. It’s a different model than Amazon and you’re taking liberties to simplify it
  - subhro 7y ago
    Really curious. How are the other guys selling for $0.99, if they didn’t get the competitive pricing? (Presumably because they didn’t go through the sign within X feet antics)
    - tracer4201 7y ago
      They did get competitive pricing, but they have a lot more wiggle room because they’re a giant company with far more revenue, marketing, and branding than a couple ma and pa stores. These distributors may or may not have the exact same terms, but at the end of the day, these other corporate stores had enough foot traffic that provided them ammo to help define their own terms. You just didn’t have that leverage as a smaller shop.
  - learc83 7y ago
    > You’re dismissing the mall call by saying no analogy is perfect since it doesn’t work for your argument but then you’re comparing against grocery stores, which is a pretty gross simplification. No I'm saying it has very important distinctions that make the grocery store analogy inappropriate and that the mall or flea market analogy is closer in some respects, but not all. >Amazon isn’t a grocery store. The majority of their catalog isn’t even available at most grocery stores, maybe excluding WalMart. Of course it's not. That's a big part of my original point. > Some were displayed on shelves and you only paid for what was actually sold. My dad worked for Lance (and frito lay for a while). I could be wrong and you could have had a very unusual distributor. But my guess is you misunderstood what was happening. Companies do sometimes offer buyback guarantees and you might even be able to buy items on credit, so that it appears you're only paying for what sells, but that's not actually how it works. Those items are the property of the store while they are on the shelf.
scarface74 7y ago
Some leases do require you to pay a percentage of sells... https://www.nolo.com/legal-encyclopedia/clb-percentage-rent.html https://www.nolo.com/legal-encyclopedia/clb-percentage-rent....