Sachinism Posted July 12, 2012 Posted July 12, 2012 Amazon has long enjoyed an unbeatable price advantage over its physical rivals. When I buy a $1,000 laptop from Wal-Mart, the company is required to collect local sales tax from me, so I pay almost $1,100 at checkout. In most states, Amazon is exempt from that rule. According to a 1992 Supreme Court ruling, only firms with a physical presence in a state are required to collect taxes from residents. Technically, when I buy a $1,000 laptop from Amazon, IÃÎ supposed to pay a $100 ÅÖse tax when I file my annual return with my home state of California. But nobody does that. For most people, then, most items at Amazon are significantly cheaper than the same, identically priced items at other stores. In response to pressure from local businesses, many states have passed laws that aim to force Amazon to collect sales taxes (the laws do so by broadening what it means for a company to have a physical presence in the state). Amazon hasnÃÕ taken kindly to these efforts. It has filed numerous legal challenges, and fired all of its marketing affiliates in Colorado, North Carolina, Rhode Island, and California. It also launched a $5 million political campaign to get voters to turn back the California law. And when Texas comptroller presented Amazon with a $269 million sales tax bill last year, the company shut down its distribution center in Dallas. But suddenly, Amazon has stopped fighting the sales-tax war. Last fall it dropped its repeal campaign in California and instead signed a deal with lawmakers to begin collecting sales taxes later this year. That was followed by several more tax dealsÃÃver the course of the next couple years, Amazon will begin collecting sales tax from residents of Nevada, New Jersey, Indiana, Tennessee, Virginia, and on July 1, it began collecting taxes from Texans. It also currently collects taxes from residents of Kansas, Kentucky, New York, North Dakota, and its home state of Washington. After all the tax deals go into effect, the company will be collecting taxes from the majority of its American customers. Advertisement Why would Amazon give up its precious tax advantage? This week, as part of an excellent investigative series on the firm, the Financial Times Barney Jopson reports that AmazonÃÔ tax capitulation is part of a major shift in the companyÃÔ operations. AmazonÃÔ grand strategy has been to set up distribution centers in faraway, low-cost states and then ship stuff to people in more populous, high-cost states. When I order stuff from Amazon, for instance, it gets shipped to California from one of the companyÃÔ massive warehouses in Kentucky or Nevada. But now Amazon has a new game. Now that it has agreed to collect sales taxes, the company can legally set up warehouses right inside some of the largest metropolitan areas in the nation. Why would it want to do that? Because AmazonÃÔ new goal is to get stuff to you immediatelyÃÂs soon as a few hours after you hit Buy. (Disclosure: Slate participates in Amazon Associates, an "affiliate" advertising plan that rewards websites for sending customers to the online store. This means that if you click on an Amazon link from SlateÃÊncluding a link in this storyÃÂnd you end up buying something, Amazon will send Slate a percentage of your final purchase price.) ItÃÔ hard to overstate how thoroughly this move will shake up the retail industry. Same-day delivery has long been the holy grail of Internet retailers, something that dozens of startups have tried and failed to accomplish. (Remember Kozmo.com?) But Amazon is investing billions to make next-day delivery standard, and same-day delivery an option for lots of customers. If it can pull that off, the company will permanently alter how we shop. To put it more bluntly: Physical retailers will be hosed. Can Amazon pull it off? ItÃÔ sure spending a lot of money to try, and it has already come up with a few creative ways to speed up deliveries. In each of the deals it has signed with states, the company has promised to build at least oneÃÂnd sometimes manyÃÃew local warehouses. Some of these facilities are very close to huge swaths of the population. Amazon is investing $130 million in new facilities in New Jersey that will bring it into the backyard of New York City; another $135 million to build two centers in Virginia that will allow it to service much of the mid-Atlantic; $200 million in Texas; and more than $150 million in Tennessee and $150 million in Indiana to serve the middle of the country. Its plans for California are the grandest of all. This year, Amazon will open two huge distribution centers near Los Angeles and the San Francisco Bay Area, and over the next three years it might open as many as 10 more in the state. In total, Amazon will spend $500 million and hire 10,000 people at its new California warehouses. But Amazon isnÃÕ simply opening up a lot of new shipping centers. ItÃÔ also investing in making those centers much more efficient. Earlier this year, it purchased Kiva Systems, a company that makes cute, amazingly productive ÅÑicking robots that improve shipping times while reducing errors. Another effort will allow the company to get stuff to you even faster. In Seattle, New York, and the United Kingdom, the firm has set up automated Ã…Ãockers in drug stores and convenience stores. If you order something from Amazon and you work near one of these lockers, the company will offer to drop off your item there. On your way home from work, you can just stop by Rite Aid, punch in a security code, and get your stuff. All these efforts seem to be paying off. IÃÎ a frequent Amazon shopper, and over the last few months IÃ×e noticed a significant improvement in its shipping times. As a subscriber to AmazonÃÔ Prime subscription service, IÃÎ used to getting two-day shipping on most items for free. But on about a third of my purchases, my package arrives after just one day for no extra charge. Sometimes the service is so speedy it seems almost magical. One Friday afternoon last month, I ordered three smoke alarms, and I debated paying extra for shipping so that I could install them over the weekend. The $9 per item that Amazon charges for Saturday delivery seemed too steep, though, so I went with standard two-day service. The next morning, the delivery guy arrived with my smoke detectors. IÃÅ gotten next-day Saturday service for free. I have no idea how Amazon made any money on my order (the whole bill was less than $30) but several people on Twitter told me that theyÃ×e experienced similarly delightful service. If Amazon can send me stuff overnight for free without a distribution center nearby, itÃÔ not hard to guess what it can do once it has lots of warehouses within driving distance of my house. Instead of surprising me by getting something to me the next day, I suspect that, over the next few years, next-day service will become its default shipping method on most of its items. Meanwhile it will offer same-day service as a cheap upgrade. For $5 extra, you can have that laptop waiting for you when you get home from work. WouldnÃÕ you take that deal? I bet you would. Physical retailers have long argued that once Amazon plays fairly on taxes, the company wouldnÃÕ look like such a great deal to most consumers. If prices were equal, youÃÅ always go with the ÅÊnstant gratification of shopping in the real world. The trouble with that argument is that shopping offline isnÃÕ really ÅÊnstantÇ÷it takes time to get in the car, go to the store, find what you want, stand in line, and drive back home. Getting something shipped to your house offers gratification thatÃÔ even more instant: Order something in the morning and get it later in the day, without doing anything else. Why would you ever shop anywhere else? http://www.slate.com/articles/business/small_business/2012/07/amazon_same_day_delivery_how_the_e_commerce_giant_will_destroy_local_retail_.html
vvvslaxman Posted July 12, 2012 Posted July 12, 2012 Loyal customer of Amazon for 13 years :isalute: Amazon
triam Posted July 12, 2012 Posted July 12, 2012 Very interesting, I am involved with something very similar but Amazon is the one to beat.
Lurker Posted July 12, 2012 Posted July 12, 2012 Who cares?? Our generation has long given up to the moralistic angles of life. I live in a state where Amazon charges for Sales tax, and I have my buddies who live in states that do not charge for Sales Tax. It is amazing to hear people who make 6 figure salaries talk why they shop on Amazon instead of Best Buy as they can have save an extra 6-8%. We live in Internet era, lets all get used to it and stop getting caught up in discussions which does tend to get moralistic. I frankly gave up long time back.
punjabi_khota Posted July 12, 2012 Posted July 12, 2012 How the hell is buying at bestbuy more moral than amazon ?? Why r u astonished at ppl wanting to save money ??
Laaloo Posted July 12, 2012 Posted July 12, 2012 Bestbuy is overpriced bullshit. I only go there to check out stuff and then come home and buy them from online :isalute:
Lurker Posted July 12, 2012 Posted July 12, 2012 How the hell is buying at bestbuy more moral than amazon ?? Why r u astonished at ppl wanting to save money ?? Like I said, its done and dusted for me. You have to bark on a different tree. :whistle3: Here is my parting shot though, look at the reason why Mom and Pop stores are failing...as the topic of this thread suggests. You may find some answer..or maybe not.
Lurker Posted July 12, 2012 Posted July 12, 2012 Bestbuy is overpriced bullshit. I only go there to check out stuff and then come home and buy them from online :isalute: I agree. Was sad when Circuit City went bankrupt. Although I did end up buying a ton of The Office CD at a buck a piece at everything-must-go sale. :secret:
vvvslaxman Posted July 12, 2012 Posted July 12, 2012 I buy in bestbuy too.. ironically all of them are online.. I bought death race blu ray for 1$ in best buy online. Same sh** cost 7$ in the stores :cantstop:
Rajiv Posted July 12, 2012 Posted July 12, 2012 At least u guys enjoy the good prices, I wanted to buy a SanDisk 64GB Micro SD Class 10, $59 with Supersave shipping and the same here is $144
Lurker Posted July 12, 2012 Posted July 12, 2012 I buy in bestbuy too.. ironically all of them are online.. I bought death race blu ray for 1$ in best buy online. Same sh** cost 7$ in the stores :cantstop: Now that I absolutely hate. I cant remember how many times same thing has happened to me. And almost always I have told the Sales guy that I can walk out, order the same thing online and save me money..only that it will make more of a case for the Best Buy retailers to lay off local chaps like him. Thats when the Manager appears to do the charge override :--D
vvvslaxman Posted July 12, 2012 Posted July 12, 2012 Another thing is store availability. For example i bought a Schwinn 431 elliptical rider 6 years back. You don't find that in regular stores. Same with Bissell deep cleaner. I bought for dirt cheap 349$ in Amazon during Thanksgiving. You don't find that in local stores. I am a consumer . I will go where the product is cheap. I have bought so many blu rays from Amazon.co.uk. yes!! That is true. Some of the blu rays are much cheaper (including shipping from UK ) than Amazon.com. Some i have bought from buy.com, some from newegg.com. Nowadays 50% of my clothing i buy onlnie. Most of the online clothing sites own their retail stores too. Just that they have more variety in all sizes online for a given brand. I bought a Tommy Hilfiger jacket for59$ online. Even in outlet mall it cost me 79$.
punjabi_khota Posted July 12, 2012 Posted July 12, 2012 Like I said, its done and dusted for me. You have to bark on a different tree. :whistle3: Here is my parting shot though, look at the reason why Mom and Pop stores are failing...as the topic of this thread suggests. You may find some answer..or maybe not. Arre bhai Bestbuy kab se mom and pop store ban gaya ? Instead of having a Best buy in your local area, now you will have a Amazon warehouse. They will pay the sales tax, hire local people and all that jazz. Where is the morality issue here ?
coffee_rules Posted July 12, 2012 Posted July 12, 2012 Any reason to beat wal-mart like retail store is a good enough reason. Why is it bad?
Texy Posted July 13, 2012 Posted July 13, 2012 Bestbuy is overpriced bullshit. I only go there to check out stuff and then come home and buy them from online :isalute: typical gujju-ness :headshake:
Crookbond Posted July 13, 2012 Posted July 13, 2012 Bro tip: Never buy women's lingerie online. :phehehe:
akshayxyz Posted July 13, 2012 Posted July 13, 2012 Bro tip: Never buy women's lingerie online. That's what a lingerie (fetish) thief would say.
Lurker Posted July 13, 2012 Posted July 13, 2012 Arre bhai Bestbuy kab se mom and pop store ban gaya ? Instead of having a Best buy in your local area' date=' now you will have a Amazon warehouse. They will pay the sales tax, hire local people and all that jazz. Where is the morality issue here ?[/quote'] Arre yaar tum log examples literally le lete ho. Ya phir I dont explain myself very well sometimes. If I say yes thanks to Amazon, Zellner's closed down, you will ask me WTF is Zellner? And why should PK care about it? Arre bhaiya Zellner is a Mom-Pop Electronic store in Little Rock, AR. For 3 generation they have been selling radio, fridge, ac etc to local community. The first ding was when WalMart and Best Buy started popping in the area, late 80s and 90s. They lost half their business then. But atleast the other half was saved thanks to knowing exactly what the consumers wanted (beauty of small stores) and also doing a bit of PR in town to save local jobs. Then Online Electronics shopping comes along and its a death nail. When Circuit city goes out of business what about Zellner's?? Look this whole discussion will get moralistic at some point. You may have a very fair point wondering why you should support local jobs? Why you should support a Zellner? Afterall its not like they will share profits with you. I tend to differ, hence my assertion. That all being said there are enough reasons to buy online, aside from price thing. Large selection, and often finding something you wont find otherwise is a good example. VVS has explained this with his Scwinn bicycle buying. PS: Zellner's is not a made up example by the way. It is a shop I bought my first big as$ TV from. They shut down recently after successive losses.
vvvslaxman Posted July 19, 2012 Posted July 19, 2012 Another Amazon.co.uk order [ame=http://www.amazon.co.uk/gp/product/B003AQCV08/ref=oh_details_o00_s00_i00]Back to the Future Trilogy [blu-ray]: Amazon.co.uk: Michael J. Fox, Christopher Lloyd, Mary Steenburgen, Crispin Glover, Lea Thompson, Robert Zemeckis: Film & TV[/ame] when you add it in cart it comes to Ž£6.25 . Shipping Ž£3.08. Ž£9.33 total In dollars $11.80 On Amazon.com [ame=http://www.amazon.com/Back-Future-Trilogy-Blu-ray-Michael/dp/B003AQCV08/ref=sr_1_4?ie=UTF8&qid=1342729780&sr=8-4&keywords=back+to+future+blu+ray]Amazon.com: Back to the Future Trilogy [blu-ray]: Michael J. Fox, Christopher Lloyd, Mary Steenburgen, Crispin Glover, Lea Thompson, Robert Zemeckis: Movies & TV[/ame] $32.99
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