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Originally Posted by DoubleF
Amazon's power isn't that they're an online retailer. Amazon's power is their logistics network and the economies of scale they have in it it that others won't have. It's basically identical to how Walmart obliterated the competition for brick and mortar in certain categories 30-40 years ago.
Saying more competition is meaningless if people don't realize the method that Amazon is using to be the giant it is. Companies have to compete on delivery and reliability, not online offerings.
Amazon reduces costs and time by using semi-automated methods to address counterfeit, low quality and issues with orders. They'd rather do that and improve the return policy than go back to hiring people to manually address/investigate issues with millions of products/orders per hour.
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Also while people can and do return things (sometimes excessively), they've certainly done the math that alot of people don't go through the hassle of returning items. It's similar to subscriptions that get way more expensive down the line.. the calculation is that many people will forget to cancel.