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Gone
Premium
join:2011-01-24
Fort Erie, ON
kudos:4
reply to TLS2000

Re: Futureshop/Bestbuy abruptly shut down a dozen stores

When one considers all the additional back-end infrastructure and freight/courier costs involved to run an operation like Amazon, and that the actual stores are capital costs that are eventually paid off, I would expect that the costs wouldn't be as different as everyone automatically assumes.

Costs would be higher for a B&M and a slight increase in price can be justified by someone who wants something right away, but those costs are certainly not so high as to justify some of the obscene price differences between the two. It is for this reason why people showroom. If they were smart, they'd turn that into an opportunity rather than something to rant about.

zod5000

join:2003-10-21
Victoria, BC
Reviews:
·Shaw
said by Gone:

When one considers all the additional back-end infrastructure and freight/courier costs involved to run an operation like Amazon, and that the actual stores are capital costs that are eventually paid off, I would expect that the costs wouldn't be as different as everyone automatically assumes.

Costs would be higher for a B&M and a slight increase in price can be justified by someone who wants something right away, but those costs are certainly not so high as to justify some of the obscene price differences between the two. It is for this reason why people showroom. If they were smart, they'd turn that into an opportunity rather than something to rant about.

To be fair the price differences between future shop/best buy and Amazon.ca (or any other Canadian online retailers) is minimal.

It's when you compare any Canadian retailer to a US retailer that that price difference is obscene.

I do think that B&M's have higher overhead. More staff, more expensive physical location, higher property taxes, more infrastructure, etc...