Quote:
Originally Posted by tubemonkey
They don't get the same wholesale rates the big box stores get.
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Part of providing goods and services is managing cost. Efficient acquisition, production, and delivery keep cost down. Volume helps with this. Everyone plays that game. If I but 36 rolls of toilet paper, my cost per wipe is lower than when I but a single roll. Small retailers have to offer something that is worth more to the consumer than the volume discount (I'll pay more for charmin than scott tissue because it squeezes better). When the value of premium service does not support the premium charged by the merchant, customers move on and the merchant reinvents or retires.
I drive past a convenience store and a small grocer for better prices on food most days. I drive past a gas station to save two pennies a gallon twice a week. I shop online (saves gas, saves time, saves money) before hoofing it to a local retailer (that happens to be Walmart) whenever I can...but not always. At the same time, I pay a premium for home and auto insurance because the company I do business with (Liberty Mutual, btw) has take very good care of me when I've needed to be taken care of. I choose expensive LM over my employer's discounted product.
Amazon has diminished the premium value of local shopping -- inexpensive and free shipping doesn't erode price advantage, returns are convenient, and support is strong. Amazon also provides better selection and, for some, eliminates a sales tax.
In the end, this is good for the little guy who, by spending less for staples, has more money to spend on other things. For those who place great value on the mom and pop shops, the 'other things' can be higher prices at the mom and pops they choose to patronize.
I still have Netflix, but I lean more towards Prime every day. I am buying more from Amazon each day (just can't buy Habanero Stuffed Olives or right angle hdmi adapters locally) and am starting to think $80/yr for shipping is reasonable. Prime is not as good as Netflix, but is Netflix worth $15/mo for the *difference* between Prime and Netflix? Prime may just be good enough. Once I spring for Prime, I am *sure* I will buy more from Amazon.
There's one more thing. I don't like Netflix. I think they are trying to squeeze every penny out of me. I think they want me to stop renting DVDs. When I choose not to get DVDs or they choose to stop offering DVDs, the premium value will be gone for me. On the other hand, I believe Amazon is working hard to keep me happy. All those free apps and books plus the relentless improvement to Prime are hugs and kisses.
That said, I don't care for the Amazon video presentation. I have trouble finding the compatible devices list nevermind selecting movies and tv shows. What would close the deal for me would be the ability to queue an evening of programming for a device. I digress...