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Originally Posted by pwalker8
However, such a model is not sustainable. Most of the business world gets by fine with win/win contracts. Companies who consistently screw their suppliers tend not to be in business long term ,long term as in 30, 40, 50 years, not 5 to 10 years.
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There is absolutely no evidence that this is unsustainable. An equally valid explanation is that Hachette is trying to gouge Amazon and consumers. Hachette is, after all, more profitable than Amazon.
But they're both giant corporations, so I think it's kind of silly to be taking sides.
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Occasionally, you run into a company that seems to get by with it. Wallmart, which really didn't hit the big time until the 80's, seems to be the poster child for that mentality. My guess is that eventually product quality will slip enough that customers start to notice and Walmart will end up falling about as fast as they expanded. We will see.
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Walmart has tens of thousands of suppliers, and if one doesn't supply a fan or drinking glass or coffee maker at the price Walmart wants, they'll go to another one.
There are only 6 big publishing houses, each one selling non-fungible goods. If S&S doesn't sell the latest Stephen King book to Amazon, it's not like Amazon can go elsewhere and get it.