this post was submitted on 23 Jul 2023
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Explain Like I'm Five

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108
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] 8 points 1 year ago (2 children)

That hasn’t been true for more than a decade. (Why be in a business you can’t make money on?) Amazon have, for a long time, invested more or less all their profits into new business lines on the promise that they could easily “flip a switch” and start making billions in profits. (They started doing that a few years ago after bad financial results.)

[–] [email protected] 1 points 1 year ago (1 children)

Sure, but in that previous time period, they didn't make a profit but were able to destroy the brick and mortar bookstore. So I guess it would be more honest to say they demolished the bookselling industry and now can argue for whatever deals they want because the only other bookstores are weakened.

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

Sure, but ”They built a very successful business and uses that to squeeze publishers“ is a very different explanation than “Amazon sells books at a loss”.

[–] [email protected] 1 points 1 year ago (1 children)

Are you referring specifically to the book sales or the company as a whole?

[–] [email protected] 3 points 1 year ago

The idea that Amazon subsidises book prices or generally sells everything at a loss is based on a flawed understanding of the early years of Amazon.