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I agree with the sentiment, but it's more about the data. Amazon wants brick and mortal sales/pricing information so they can undercut you more effectively. The

I agree with the sentiment, but it's more about the data. Amazon wants brick and mortal sales/pricing information so they can undercut you more effectively. They'll probably bundle in some service where you get an online store for cheap/free, which makes you even more dependent on them for inventory management as well. At that point Amazon controls your cashflow and your products and--in a sense--owns your business.

opendais 12y ago
Yes, its this. Its also what Amazon does to its drop ship companies if they don't manufacture their own products. ;) ITS A TRAP! :P
jnardiello 12y ago
Yes. And just to add another evilish detail: Controlling your cashflow means also that you are effectively borrowing them 2+ weeks of your income (as far as they will pay you with recurrent wires AFTER you have sold your stuff) at no cost. On a very low level, this is the mechanism that allowed them to survive for years without making profit on their products.
- totalrobe 12y ago
  Why do you say Amazon is controlling cashflow? It looks like they offer bank transfers everyday. From the site: "Fast, reliable deposits. Deposits to your bank account the next business day. Or spend your money at Amazon.com within minutes."
  - cbhl 12y ago
    Because that's not how long it takes for money to really clear a credit card when banks are involved.
    - totalrobe 12y ago
      Well then one business day would be an improvement on cash flow vs a typical bank... or am I an idiot? Obviously it's hard to compete with Amazon on commodity products, but it seems like they are lowering the barriers to entry for many unique retailers and small businesses.
      - cbhl 12y ago
        The argument is that on some unspecified future date when Amazon has a monopoly, they can arbitrarily choose to hold payments for more than a day and screw up a business' cash flow and cause them major headaches. Anyone who relies on PayPal today already accepts the risk of having their account/funds frozen, and there are already many horror stories of businesses having tens or hundreds of thousands of dollars locked up for a three-month investigation (only to go bankrupt in the interim).

opendais 12y ago

Yes, its this. Its also what Amazon does to its drop ship companies if they don't manufacture their own products. ;) ITS A TRAP! :P

jnardiello 12y ago

Yes. And just to add another evilish detail: Controlling your cashflow means also that you are effectively borrowing them 2+ weeks of your income (as far as they will pay you with recurrent wires AFTER you have sold your stuff) at no cost. On a very low level, this is the mechanism that allowed them to survive for years without making profit on their products.

totalrobe 12y ago
Why do you say Amazon is controlling cashflow? It looks like they offer bank transfers everyday. From the site: "Fast, reliable deposits. Deposits to your bank account the next business day. Or spend your money at Amazon.com within minutes."
- cbhl 12y ago
  Because that's not how long it takes for money to really clear a credit card when banks are involved.
  - totalrobe 12y ago
    Well then one business day would be an improvement on cash flow vs a typical bank... or am I an idiot? Obviously it's hard to compete with Amazon on commodity products, but it seems like they are lowering the barriers to entry for many unique retailers and small businesses.
    - cbhl 12y ago
      The argument is that on some unspecified future date when Amazon has a monopoly, they can arbitrarily choose to hold payments for more than a day and screw up a business' cash flow and cause them major headaches. Anyone who relies on PayPal today already accepts the risk of having their account/funds frozen, and there are already many horror stories of businesses having tens or hundreds of thousands of dollars locked up for a three-month investigation (only to go bankrupt in the interim).