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Let's believe Amazon is able to find seller's selling their products elsewhere and ensure they're not selling it any cheaper thus forcing them to raise prices e
by soheil 5y ago
Let's believe Amazon is able to find seller's selling their products elsewhere and ensure they're not selling it any cheaper thus forcing them to raise prices everywhere. Ignore the PR nightmare for a second as a result of people finding this out. I'd like to argue it may not be as bad as it looks at first glance.
The scale at which Amazon operates at improves many aspects of the online shopping as a whole for every consumer even if not on Amazon. For example the shipping efficiencies resulted from FBA have distribution centers close to consumers, moving products much more efficiency across the country than if there were many small e-commerce stores each doing it their own way causing massive friction. The true cost wouldn't be apparent in the later case since the added friction would seem just normal and part of life as there wouldn't be anything as efficient as Amazon to compare it to.
There are other inefficiencies that would result in having competing online stores on various platforms making it harder to find a product at a reasonable price without spending more time searching various stores and truly understanding the offered price after all the fakeries of promotions, cash-backs, pay later but with insane interest that we won't disclose to you at the times of purchase, hidden subscriptions fees instead of a one time payment and other scams used to be employed by numerous online stores before the days of Amazon.
The cost of products sold to run a successful operation like amazon must be very close to the real cost that those products should be sold at when taking into account the shipping costs, supply logistics, cost of warehouse operations, etc. any devision from that by increasing prices and people see you as a monopolistic evil and your days are numbered, any lower than that and you wouldn't be able to scale as fast as economically possible.