Jeff Bezos’s story is the classic mixture of brains and opportunity. This Princeton University graduate had worked on Wall Street in computer technology. When the internet started taking off, he left his job and put together a business plan to sell books. Part of his plan was that his clients could avoid sales tax through internet purchases. He even started out like so many entrepreneurs, in his garage. That is where it all started, but there is so much more. Type in the name of any product that you wish to purchase and one of the first sources will be Amazon.com. That is a tribute to Bezos’ vision, smarts, and attention to detail.
Bezos built a site that could be considered a concierge for all consumers. When you look for a product on his site, you will get the product, quality graphics, client reviews, and alternative products. The only question left is how you want to pay for the purchase. Throw in competitive pricing and free shipping and you have really got something.
Bezos took on the brick and mortar retailers by building distribution centers to fulfill customer orders. This ensured quick delivery to eager customers.
All of these items not only add up to a quality internet retailer, but a “category killer” in the field. That means that customers will go to Amazon.com first, find what they want, leaving no room for competition. What Bezos has built is a company that weathered the internet bubble burst and housing meltdown. It has not always been easy and that will continue; operating margin is 1% and return on equity is currently negative. However, revenue growth is strong, cash flow is solid, and the stock price reflects this. Nonetheless, a quick search of archived articles on Jeff Bezos will show that his demise has been as exaggerated as Mark Twain’s. If you don’t know much about Mark Twain, look him up on Amazon.com. They have got plenty on him, and, if you buy enough, shipping is free.