The Company's principal business is the sale of trade books, mass market paperbacks, children's books, bargain books, magazines, music and movies direct to customers.
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Once Amazon $AMZN is forced to pay sales tax in all 50 states. They will look to acquire a brick and mortar such as Barnes and Noble. Naturally they will rename the stores, "Amazon Outlet".
What if the buyout price is $300 million?
And they won't charge sales tax in the store either, right?
Well 300 million is certainly cheaper than 700.
And yes they will be forced to pay sales tax whether they like it or not
$677 million market cap
As long as Barnes & Noble (er..."Amazon Outlet") stayed open that would remove my main reason for hating Amazon.
Generally, it's a bad sign when the top bull pitch is this illogical. Applying sales tax will have a significant impact but it will not turn Amazon into a low ROI, low growth company nor will it turn BKS into a high ROI, high growth company. If you understood AMZN management, you would realize the odds of them buying Barnes & Noble are lower than being struck by lightning while being mauled by a bear.
Megashort,
You fail to realize the potential of knocking out your 2nd biggest competitor in the e-reader space or the fact that AMZN hasn't absorbed a brick and mortar because of the state tax implications. Barnes and Noble will be the last major bookstore standing!
"...the fact that AMZN hasn't absorbed a brick and mortar because of the state tax implications."
So why hasn't Amazon opened any retail outlets in states without sales tax? Maybe because big box retailers have lower growth and ROI than Amazon's online retail? That is an actual "fact".
Mega short...FACT: if they open a brick and mortar, AMZN customers from all 50 states will pay state sales tax. It doesn't make any sense for Amazon to do that now.
Obviously you have no source for that, because it's not true. In any event, it's irrelevant since collecting sales tax is not going to make AMZN buy out BKS or make BKS a good investment.
Good luck with your hallucinatory investment thesis.
Thank you for the good luck!
I gotta admit, the thought of Amazon buying out B&N and renaming them into "Amazon Outlet" got a snort out of me. I've heard crazier ideas, and I certainly wouldn't bet on this outcome, but I enjoyed the ingenuity of the idea! Thanks! =)
But you are right about one thing.... if the buyout price is right, even Amazon might be tempted. *shrug* As unlikely as the idea is, I wouldn't dismiss it completely!
All the competitive advantages that amazon has built over the years by selling the highest volume possible at razor thin margins with a ridiculously large inventory are all the same reasons that the same business model could NOT be applied to brick and mortar stores.
Sales taxes would hardly put a small dent in Amazon's business. The main difference is the costs of employees to be on the floor answering my questions and helping me find something to look at that I'm going to buy on Amazon, the large Real Estate costs, shelving costs etc., etc. Best Buy is having the same problem. Do I need to mention Blockbuster?