Operating a website is expensive--not only because programmers are expensive, but because margins are smaller.
For 10 years, Bridge has encouraged stores to beef up spending in preparation for the e-commerce boom. It's easier to spend a little each year over many years than spend money in a panic. Money spent in haste often results in waste. As a reference, when traditional retailers tried to catch Amazon, they often failed in their scramble. Please recall Macy's buying the ...
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May 21, 2016
May 21, 2016
Imagine if you had a rich uncle to float your retail business? Amazon didn't start out with one, but now it has one via its cloud computing service. The cloud computing service had an operating profit margin of 23% while its retail segment had a rate of 2%. Essentially, Amazon is selling retail stuff at close to a loss - a practice few retailers would pursue. But if one makes a 23% profit on other stuff, it can afford to. Competing against a 'store' with a rich uncle is not fun.
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