

The Upcoming Crash Of Apple And Amazon - kitsune_
http://market-ticker.org/akcs-www?post=194889

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IanDrake
>you need to show how Amazon loses that 6% price advantage against a 3%
operating margin and survives

This assumes that people only shop at Amazon (or online) because it's cheaper.
Not so. It's more convenient.

Last winter when we got blasted with snow in N.E. there were no snow blowers
to be had within a two hour drive. I bought one off Amazon with next day
shipping (for an extra $5, I'm a Prime member).

We have Amazon boxes arriving at my house every week. Paying sales tax isn't
going to slow that down.

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dave1619
That's true. I buy tons of Amazon stuff. Sometimes because it's cheaper. But
most of the time because it's more convenient (even when it's more expensive).
I factor in wasted time/gas/energy to go to the store and Amazon wins out
almost all the time.

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allwein
Exactly. I think the only thing I buy from Amazon based purely on the sales
tax benefit is video games, which are the same price both online and off.
Everything else is because of convenience and selection.

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smackfu
Thoughts on the Amazon part:

1) Amazon has 55% North American net sales and 45% international. Amazon pays
taxes on all of the international sales, and the Canadian portion of the North
American sales.

2) Amazon collects taxes in 5 U.S. states today: KS, KY, ND, NY and WA. That's
about 11% of the population. Another 3% of the population lives in states with
no sales tax anyways.

3) Amazon currently charges 40% below list price on the bestselling media.
Would charging 35% below list chase people away?

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dave1619
This guy doesn't know what he's talking about. Apple products have proven to
be appealing even through the Great Recession. More people will buy iPhones
and iPads. Amazon has an infrastructure no one comes close to with online
ordering, inventory and delivery. People trust Amazon and it's just growing.

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nextparadigms
This guy is either genius or insane. Guess we'll find out soon enough.

The Touchpad pricing eroding the price perception for _all_ tablets, including
the iPad, does sound like a bit of common sense, though.

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mistermustard
Hardly anyone can sell a tablet at the iPad's price point and turn a profit at
all. Does lowering that price point make the tablet market even more
attractive?

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romey
Does Amazon make no money from AWS and their other ventures, like the Kindle?
It seems hard to believe that possible tax reformations could kill such a huge
company.

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allwein
The way he's throwing the numbers around, he almost seems to be implying that
Apple would have to pay the 6% sales tax out of pocket, thus reducing their 3%
profit to a -3% loss.

Even if Amazon collected sales tax, their base prices are often cheaper than
the local prices here, so I'd still order from them.

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rayiner
This guy is a kook. Yeah yeah, ad hominem, etc.

