The Best Thing About Amazon Was Never Going to Last | If shopping on the site feels different now, that’s because it is::If shopping on the site feels different now, that’s because it is.

  • NAK@lemmy.world
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    1 year ago

    Yeah. And that’s fine.

    Cost is a concept in retail that gets manipulated a lot. In my previous example there is no way the actual “cost” of the USB cable was $2. When you factor in employees, rent, bills, logistics, customer service, etc etc the cable was likely more like $5. Best Buy made have paid $2 for that cable, but the actual cost to sell it, taken as a whole, was more like $5.

    That other $3 is essentially what Amazon is making. If you sell on Amazon they build and maintain the website, logistics, warehousing, etc etc. You can create an online store and have exactly 0 employees or logistical infrastructure. Amazon has spent literally billions and billions of dollars building all of that.

    • treefrog@lemm.ee
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      1 year ago

      Amazon is the mall Best Buy is paying rent too. It’s not a store itself but overhead the store pays.

      To use your example if the cost of the cables is $2 and the selling price is $20, Amazon’s rent is $10 of that. Leaving $8 as Best Buy’s profit margin.

      • NAK@lemmy.world
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        1 year ago

        Exactly. Amazon is essentially running a huge chunk of a retail business for their customers, the people buying and selling products. The reason you pay these fees is so you don’t need to run a website, build and maintain warehouses, pay staff like HR, etc etc