Explain Like I'm Five

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ELI5: How is Amazon able to sell me books so much cheaper than brick and mortar book stores in my area (lemmy.world)

submitted 1 year ago by [email protected] to c/[email protected]

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I like shopping in book stores. There's something about wandering the aisles and waiting for a book to jump out at you that I can't get shopping online. Unfortunately, whenever I compare the price of a book Amazon has every in-person store beat, often pricing their offerings 30%-50% lower (or around $10/book in my experience) even when I go to a large chain like Barnes and Noble.

How is it that Amazon is able to afford to offer the books so much cheaper and also support all of the infrastructure involved in shipping it to my doorstep compared with in-person stores?

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[–] [email protected] 7 points 1 year ago

Two things. Commercial real estate required for physical book stores is expensive. Amazon has warehouse space, but so does the bookstore company. Volume discounts. Amazon probably sells double the volume of their next biggest competitors. This allows them to purchase the books for cheaper than their competitors. This also goes for shipping. They make the same kind of arrangement with USPS that allows them to purchase shipping at a discount since they buy so much of it.

There are other reasons, but those are the biggest.