Amazon to Open Retail Location

I am a huge fan of Amazon.com.  As an avid reader, Amazon is the go to spot for any and all titles, at a reasonable rate.  They have also expanded into other product lines and they allow other retailers to use their platform, for a small fee.  Their used book market is also the premier internet book resale market, with students searching for textbooks and adults looking for novels and everything in between offered at a great rate.  Once again, Amazon provides the software and will handle various issues, for a commission on all sales.  They must have the model priced correctly, as there are many books that sell for $00.01 + 3.99 shipping.  I am intrigued by the Kindle, and may consider it when I decide to purchase a tablet, but for now I am going to stick with my MacBookPro until it becomes obsolete.

The exciting news that is being speculated is that Amazon may be expanding and opening a physical retail location.  This is surprising due to the recent struggles of book stores, precisely as a result of Amazon, see Borders Bankruptcy, and the rapid closing of independent book stores as the general public is less inclined to read.  I think that just looking at those factors would mean that investing in retail locations would be a mistake.  However, the angle that Amazon can use to be profitable, is to sell high margin books, Kindles, Kindle accessories, and offer some kind of a cafe.  Unfortunately, fellow Seattle based - Starbucks is in contract with Barnes and Noble, the dominant physical book retailer, and fierce competitor of Amazon, because that would be a match made in heaven.  I think that Amazon could work with another company to create a great cafe experience, with free wifi, a custom, rotating, selection books, the possibility of ordering books from the site to be picked up at the store and comfy lounge chairs, could be a great way to gain market share.

According to the sources I have seen, this is basically the model they are considering.  The rumor is that they will open a location in their hometown, Seattle, known for its willingness to try new things in technology and a love for cafes!  They are not looking to create a Barnes and Noble superstore, more like a boutique, and I think it can be a successful new line of business to drive profits for the e-commerce giant.

Source: Ritholtz

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