Ever Wonder Why Amazon Thrives?

[Jcon268]

In the late 70's, I went into a small town pharmacy to buy an over the counter product.

The price was over 3 times what I was used to paying.

I was so astonished I blurted out, "I buy this same item for x-number of dollars at Eckard's."

The store owner heard me and yelled, "Yeah, if you want to spend your money for a bunch of New York Jews!"

Needless to say, I never darkened his store again...

But no, small businesses won't bend you over and drive home a good deal... if they can.

They're noble.

BTW, many folks in this small town had to drive too far to get to an Eckards/Walgreens so the small business 'was' the only game in town.

That sounds like a bad experience and horrible service. If I was that same business owner, I would have stated it like this:

*For whatever reason* I am unable to get you your product at the price you've seen elsewhere. If it was possible that I had a substitute item at a competitive price, I would have offered that. If that was not good enough, I would have picked up the phone and called a place to check if they could get it to you closer to market value.

I tend not to offer things I can't offer at a good price. It's embarrassing to upcharge by that much, however, there are times people need things quickly and conveniently. Sometimes they need it NOW and not 2 days from now. I try to carry other products that might be substituted at a better value, if possible...and let the customer make the choice.

 

[MannyGlocks]

Jcon,

My experience is limited?

Hhhmmm, does my living all around the world and this country at different times count as limited?

Ah, no, no it doesn't as a matter of fact.

Oh, too I was in charge of a vast corporate budget for major projects world wide.

My fiduciary responsibility was vast...and too my experience level.

Can you say the same?

 

[Hueco]

I remember the words coming out of my mouth probably close to 10 years ago...."Well Amazon will never affect the food service industry. What are they going to do, deliver meals to your door?" Imagine how reluctant I was to eat those words when I saw that Amazon, in fact, now offers food delivery service.

I guess the point in all of this is where do your priorities lie? If it's to get the absolute most bargain cheap product you can get, you'll probably get it on the world's largest online clearance bin. There are other aspects of what make a small business valuable but that's obviously not to everyone. I get customers almost every day that just want cheap. They'll also usually drive across town and spend dollars on gas to save a buck. The business I run was handed down by my father who started the business based on the concept of community relationships. There are people who only get their equipment through us. However, there are times where they hand me a wish list and I have to be honest with them....I just can't buy it cheap enough to make it worthwhile. But we get it right 80% of the time.

I don't like the taste of crow so I try not to make too many future predictions ;-).

Personally, I'd rather buy once and buy right. I have a very nice kitchen knife set. Each and every knife I prize, and it's taken over a decade to compile it. I will always save up and spend for quality items that I can use for years and even pass down to my daughter. (I still play golf with my dad's Ping Eye 2's...if it ain't broke ) I also still photograph with a Canon 1V. That camera will outlive me...let's put it this way, I could beat you to death with it...and still use it to photograph your body .

I also got customers who couldn't even stomach paying $8 for an 8x10 of little Johnny scoring the winning shot. Skills are valuable only as the market dictates. As a wedding shooter, I still had business because of my ability to frame, light, and afford gear that gave me a "look" - I can use bokeh like the best of them.

But now, portrait shooters are even losing ground there as iPhone software now simulates bokeh and/or differing focal lengths. There's a reason I got out of the photo rat race...just got tired of it.

But, I do wish you luck. I'm glad we've crossed paths here. If/When I need a repair on my violin, I'll shoot you a message.

 

[Mikej]

The ignorance here is rather astounding. I'm sure you guys saying small business doesn't matter are all for big government too right? Isn't it great when one company monopolizes a market and controls it right down to the manufacturing process?

But yeah a few extra bucks in your pocket is more important than a guy being in business at all.

Sounds like you have one opinion on the matter. Not sure what it's founded in other than perhaps your limited experience. It's clear that you haven't worked in many if any small business environments but tell us how it is, please.

It's actually not a scare tactic, it's the truth. A lot of small businesses have been run out by Amazon already but there are still a lot left. Yes, those businesses have diversified to stay alive and they offer .......SERVICE. Gasp. This is WHY Amazon still has to keep those prices low. Only 5% of retail spent dollars are funneled through amazon despite them having 49% market share.

If buying something you didn't like and being able to box it back up and return it equates to service for you then I'm not sure we're in the same discussion. What I see with my own eyes nearly on a daily basis is people buy cheap junk online and try to bring it to us for fixing. That or they just realize they bought junk and have to now rebuy again. How are we supposed to feel bad when you get taken when you didn't take the time to see if a local shop could have offered something similar at a reasonably competitive price?

You're talking to a bunch of "Boomers" and "Gen Xer's" here. I'm thinking there are not many of THEM that are ignorant, OR seriously lacking experience, on life matters and shopping.

 

[Jcon268]

Jcon,

My experience is limited?

Hhhmmm, does my living all around the world and this country at different times count as limited?

Ah, no, no it doesn't as a matter of fact.

Oh, too I was in charge of a vast corporate budget for major projects world wide.

My fiduciary responsibility was vast...and too my experience level.

Can you say the same?

I meant to say your experience in a small business environment seems limited. Small businesses operate completely differently. One person wears many hats in a small business because he has no other choice. He makes the orders, he stocks the warehouse, he greets the customers, he answers the phone, he prices the product, he handles the return process, he pays the taxes and all of the bills, etc.... The owner also pays employees and is the last to get paid. Small businesses have to turn on the lights and heat for customers that may or may not ever walk into his place of business that day. Just sounds like different experiences, that is all.

 

[MannyGlocks]

Fair enough.

For years I had my property landscaped, mowed, trimmed etc.

Then, as I'm a hands on guy I decided I'd do this myself once retired.

So, first thing was to buy a zero turn big mower.

I shopped and found I could buy it for $500.00 less online vs the local dealer. This piece of equipment cost in the high multiple thousands.

I decided to buy it from a local dealer as I value his service and wanted him to still be in business when I needed further service.

So, yes, at times I buy from small business.

Doing so though is not altruism on my part.

To use that shop worn cliche, it was win-win for both of us.

 

[CountryGent]

BOT, I've thought about getting Prime lately. I find myself searching Amazon before buying most things.

It is worth it, imho, if you do a lot of biz with them. Free shipping and access to their video content was why we did so.

 

[raftman]

Good luck with those "odds".

Considering it's been literal years since I've had to resort to Amazon, I'd say the odds have been pretty good.

Like I said, I'm not much of an online shopper, I'll pay a little extra to get something the same day and not leave it sitting on my porch for hours. If the cost difference is too big to justify, I haven't had much trouble finding competitively priced alternatives elsewhere.

 

[Jcon268]

Fair enough.

For years I had my property landscaped, mowed, trimmed etc.

Then, as I'm a hands on guy I decided I'd do this myself once retired.

So, first thing was to buy a zero turn big mower.

I shopped and found I could buy it for $500.00 less online vs the local dealer. This piece of equipment cost in the high multiple thousands.

I decided to buy it from a local dealer as I value his service and wanted him to still be in business when I needed further service.

So, yes, at times I buy from small business.

Doing so though is not altruism on my part.

To use that shop worn cliche, it was win-win for both of us.

I'm not trying to say that buying from a small shop is always the most sensible option.... but in the case of your mower, my experience with lawn equipment at that cost is...it is going to need to be worked on at some point. If we sold it to you, we'd have definitely taken care of any small wear and tear maintenance at no cost to you. I feel confident the guy who actually sold it to you will take care of you should something go wrong.

 

[Mikej]

BOT, I've thought about getting Prime lately. I find myself searching Amazon before buying most things.

I finally did the "Free Month" of Prime because I was getting something that cost like $20.00 +/- and wanted some crazy $12.00, or something, for shipping. I would have to cancel before the next month came up or they'd bill my card, but seeing as it was only &12.00 a month I've kept it. The catch is, you find the item on Amazon but if it's coming from someone else, shipping isn't' covered. I'm still ahead though and will likely keep it through X-Mas at least. I

It's foreign to me finding what ever I'm looking for and hitting the buy button, confirming payment with my card they have the number for and BAM! Done! It's sort of a rush.

 

[MannyGlocks]

Yeah, he will and has, so the savings in cost I could have realized online has been more than made up for by his going the extra mile.

As in: He delivered it to my home personally. Then comprehensively demonstrated it's care, feeding and tips on how to mow.

Plus, I made a new friend. He's a great guy.

He's been in business selling and servicing high quality equipment like Stihl, Toro and so on.

His business was started by his Dad and they've been in business for over 40 years competing and beating big box stores.

 

[Jcon268]

Trust me, man, I feel for you. I developed a talent for photography in high school and started out in a studio. There was a good bit of demand back when you had to know how to control lighting, develop, and print film. Hell, even spot touch in color where the dust got in the way. I doubt if any of today's photographers would have the first clue how to spot touch...

Anywho, I went solo for a time and over that time I lost my kids school photography to parents with iPhones, lost my youth sports action to cheap DSLRs. Youth team shots, weddings, and high school senior shots became the only consistent revenue streams. I have since got out of that rat race. But, while there, I learned a lot about business process design and automation (solopreneur, remember?)...and started advising other small businesses on how to do the same (run the biz and market at scale like the big boys). Except now I do the same thing for Enterprise corps because...well, it pays better .

It's taken Amazon years to become profitable. That free freight on a $20 order was subsidized not only by other parts of the business but by capitol investors as well. Now, they've got distro centers all over, negotiated rates with the shipping companies, and have their own delivery service akin to Uber. (You can sign up to be an Amazon delivery person. I've known many an Uber drive who did both)

You have to buy a Fender in limited quantity, so you pay more and have to charge more. Some internet biz buys 100 Fenders at a time and has them airdropped to a Fulfillment by Amazon distro. He can now charge less. Just wait until Fender themselves realizes that *they* can do Fulfillment by Amazon and can cut both of you guys out.

That's what I mean - the retail of an item like that simply makes you a cog in the machine. Once manufacturers realize they can go straight to retail using Amazon, it's over for the cogs. Services are the future: Repair, Rental, Lessons...things neither the Manufacturer nor Amazon can provide.

It is worth it, imho, if you do a lot of biz with them. Free shipping and access to their video content was why we did so.

I do a fair amount of business through my wife's Amazon account. I'd say I buy, on average, on or two things per month. We also stream Amazon services. Oddly enough, I just complained the other day about rentals costing more through Amazon than grabbing them through Redbox. Then I caught myself and thought, screw it, I'll pay the extra few bucks to not have to step over the homeless camp outside 7-11 to get to the Redbox machine.

 

[Jcon268]

Yeah, he will and has, so the savings in cost I could have realized online has been more than made up for by his going the extra mile.

As in: He delivered it to my home personally. Then comprehensively demonstrated it's care, feeding and tips on how to mow.

Plus, I made a new friend. He's a great guy.

He's been in business selling and servicing high quality equipment like Stihl, Toro and so on.

His business was started by his Dad and they've been in business for over 40 years competing and beating big box stores.

Excellent story.

 

[Cavedweller]

And I also love that Amazon told the authoritarian Marxist regime in Seattle to go eff themselves.

Posted this in another thread yesterday, but what the heck...

Correction: Amazon-City Council Spending story

SEATTLE (AP) — In a story Oct. 29 about Amazon's contributions to the Seattle City Council elections, The Associated Press misspelled the last name of a council member.

apnews.com

 

[2A2Dend]

In general, We The People created what We The People are getting, and/or have in terms of convenience in the world as we know it today.
That model isn't going to change, but it will get more, I will not use the reference "convenient" as/to buying online.
The Brick-N-Mortar shops that are still there locally to you, consider them fish in a kettle over a hot fire. They'll swim till they get boiled and consumed, or maybe a little more wise, and bail out. Either way, Brick-N-Mortar stores are consumables and deplorable to anything "online"

 

[Jcon268]

In general, We The People created what We The People are getting, and/or have in terms of convenience in the world as we know it today.
That model isn't going to change, but it will get more, I will not use the reference "convenient" as/to buying online.
The Brick-N-Mortar shops that are still there locally to you, consider them fish in a kettle over a hot fire. They'll swim till they get boiled and consumed, or maybe a little more wise, and bail out. Either way, Brick-N-Mortar stores are consumables and deplorable to anything "online"

Like anything, it's all about adapting. He who adapts the quickest and most effectively has a spot. I think brick and mortar stores are massively underestimated. Jeff Bezos is a very smart man, but there are a lot of small business owners who are doing a great job of staying afloat. It's just that Amazon has carved out a large section of the market and a certain amount of those businesses sank because they couldn't swim. In some ways, this is good for the market.

 

[Joe13]

As someone who runs a small business, I know for fact that Amazon uses its buying power to drive prices down considerably below standard wholesale. Then they formulate minimal margins based on volumes that no small business could sustain, in fact many other corporations probably won't touch....save for maybe Walmart and a few others.

While I like Amazon, try to understand that there are reasons for small businesses to exist outside low profit retailing. That doesn't mean a small business should be gouging with their prices....but the disparity in prices seems drastic only because of factors I mentioned above. My guess is that NAPA in the end wasn't making much more, if any more at all off selling you the part compared to Amazon. It's also possible they were price gouging to make up for lost volume because of sales to Amazon? In that case, I think the writing is on the wall.

We live in a day and age where consumers can buy just about anything at artificially low prices. Enjoy it while it lasts...it won't last forever.

Ive been a NAPA counter person way back when, and I can tell you they don't care about retail sales one bit.

90% of their business comes from commercial accounts -retail is just a side note.

Thats why their prices are higher then everyone else's in town.

I won't shop their unless I have no other alternative.

 

[Jcon268]

Ive been a NAPA counter person way back when, and I can tell you they don't care about retail sales one bit.

90% of their business comes from commercial accounts -retail is just a side note.

Thats why their prices are higher then everyone else's in town.

I won't shop their unless I have no other alternative.

I had a relatively okay experience at NAPA when I went to replace the window motor in my old Nissan Xterra. It cost me $90 at NAPA and the dealership said closer to $400
I guess it's never fair to compare anything with a dealership though, since they're notorious for gouging. By the way, that dealership is gone now too.

 

[Caveman Jim]

I'm a grumpy old fart and you young whippersnappers can have all this newfangled technology.
It's too bad you didn't get to experience the America I grew up in.

 

[Oregonhunter5]

I'm cheap a lot.
As much as I love some brick stores, I don't see paying more at that brick store is dumb business.
Change sucks a lot of the time.
But being poor is far worse.