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Tom Walker

Tom Walker
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  • A Quick Take On Amazon [View article]
    Amazon margin is less than 12% if you put freight in as a variable cost not under the line as a fixed cost. Walmart & Costco buy at lower prices than Amazon due to far fewer SKUs, more volume per SKU. Costco and WM make more money in 60-90 days than Amazon ever has made. Costco and WM pay their suppliers in less than 35 days. Amazon pays 75 days.

    Can't win.

    I love Amazon as a consumer!
    Apr 7, 2014. 10:30 AM | 8 Likes Like |Link to Comment
  • Signs Point To A Costco Negative Surprise [View article]
    Correct on all points I believe.
    Mar 4, 2014. 09:54 AM | Likes Like |Link to Comment
  • Signs Point To A Costco Negative Surprise [View article]
    Target is flailing if not failing in Canada, there first foray overseas. Costco's best market is Canada according to their CEO and they have succeeded where ever they have gone. Spain up next. Walmart has Target outflanked in Canada and Mexico. WMT has succeeded in most markets they have entered except Germany when they couldn't sell as many hours as they wished nor as low as they wanted. Wisely they got out. Costco and Walmart have faster growing websites. Target unwisely stuck with Dept stores too long while Walmart and Costco expanded overseas. Target unwisely deferred website development to Amazon and is catching up. Walmart has Sam's to compete with Costco. Target has no club. Hard to see why anyone would think Target is equal to either.
    Mar 3, 2014. 06:43 PM | 2 Likes Like |Link to Comment
  • Amazon Targeting Costco, Sam's Club With 'Pantry' Initiative [View article]
    Michael, better terms are offered for marginal products, such as ours.

    The people with the Core 4000 do not.

    So Amazon is walking into a bear trap with the 4000.

    Yes, they bought their HQ. but they are also buying warehouses, hiring just above minimum wage people, everything their competitors aren't doing.

    Costco has SGA of 8.5%. Amazon almost 20%. So they lose every day.

    Tom
    Dec 15, 2013. 02:55 PM | 1 Like Like |Link to Comment
  • Amazon Targeting Costco, Sam's Club With 'Pantry' Initiative [View article]
    Michael, a nice comment. To deal with my math/your math. Your comment would be correct if I had not taken the conservative approach of saying 76 was at least 30 days longer than other payments. So that's where my 1/12th comes from. With your assumptions it is even worse. A previous Alpha article pointed out that Amazon AP has peaked and started to decline slightly. That's why they had to borrow $3B last year which led to two over junk bond ratings. Also, my company sells downloads and eCommerce drop ship products. We get a far better faster return from Costco, Staples, and Walmart than Amazon. We are a little dog. Clearly the same goes for the big dogs who will be more supportive of the faster paying traditional retailers than Amazon, and have the power to do so.
    Dec 15, 2013. 08:58 AM | 1 Like Like |Link to Comment
  • Amazon Targeting Costco, Sam's Club With 'Pantry' Initiative [View article]
    The elephant in the living room is Amazon AP now at 76 days. This delay in payment has financed at least an extra 30 days of Amazon sales or 1/12th of their annual sales versus their retail competitors. The suppliers of the top 2000 items at Costco and grocery do not tolerate more than net 30. These suppliers include P & G, Kelloggs, Kraft, and other big brands. The current 76 day AP is that high because of smaller suppliers who Amazon extends AP to over 100 days such as via audible. If Amazon plays with the big dogs, the mix will bring the 76 days down substantially. Their debt is already rated by Moody's at only two notches above junk. In short, where would Amazon get the cash to pay the big dog suppliers? Not from profits since they have none. Not from additional supplier terms. Not from additional profits from new big dog brand sales because Amazon is already losing money or at break even AND the big dog brands have even lower margins than the other brands Amazon carries. This move would make Dunkirk look like a victory.
    Dec 15, 2013. 05:58 AM | 5 Likes Like |Link to Comment
  • Costco's Earnings Preview: Rise In Membership Will Lead To Steady Growth [View article]
    Costco is a remarkable story about trust. Grapefruits vary in cost to retailers. If they get a deal, they cost less for a bag; if the deal isn't so good, we pay more. We always know they treat us fairly. Also, they treat their people well so you get to know the people by face and they you. Costco Canada is their best market according to the CEO. My company sells them downloads and physical products online. This lets customers not near a Costco buy from them. They pay on the button. They negotiate great prices but always treat suppliers fairly. A wow account. And, I must admit, I love a CEO who says he will protect the $1.50 hot dog if he has to pay for it--with the big drink and it is a BIG hot dog. They beat amazon every day because of 8-9% SGA, lower product costs because they stock fewer item. Listen to the CEO on Mötley Fool's latest interview of him.
    Dec 9, 2013. 05:14 PM | 2 Likes Like |Link to Comment
  • Dollar General beats by $0.03, beats on revenues [View news story]
    Please post Y/Y EPS too....
    Sep 4, 2013. 08:42 AM | Likes Like |Link to Comment
  • Amazon: A Good Long-Term Play [View article]
    Bad investment now. Losses are continuing and accelerating. The big guns in retail are taking the challenge more seriously plus making lots of money: Staples, Walmart, and Costco, among others. And using their efficient approaches to out perform Amazon.
    Aug 14, 2013. 09:25 AM | 5 Likes Like |Link to Comment
  • Amazon: A Good Long-Term Play [View article]
    My point was even with awesome service Amazon is a bad investment. If you are right it is even a worse investment.
    Aug 14, 2013. 08:37 AM | 2 Likes Like |Link to Comment
  • Amazon: A Good Long-Term Play [View article]
    You believed him? The ultra micro manager.
    Aug 14, 2013. 08:35 AM | 1 Like Like |Link to Comment
  • Amazon: A Good Long-Term Play [View article]
    The purchase of the Post shows a distracted CEO and turned the Amazon stock price flat and now down. Is it cover for a company that can't or won't earn a profit driving sales through low prices and investing in awesome customer service? Peter Lynch famously said, "Never confuse the product (in Amazon's case, awesome) with the company (Apple earns more money in 10 days than Amazon ever has)." What if Amazon did earn $1B per year? Analysts would start looking at that metric and the stock would accelerate down. Situation hopeless and the CEO has a new toy. Why not if you have $25B?
    Aug 14, 2013. 08:03 AM | 3 Likes Like |Link to Comment
  • Amazon: A Good Long-Term Play [View article]
    Operating costs are high and will get higher by building more warehouses and trucks for local delivery. The other main online retailers are profitable and growing their profitability by not building more warehouses and using the highly efficient FedEx and UPS to do their online deliveries. Staples, the #2 online retailer with $9B has announced their major plan to cut back warehouse space, store footage, increase vendor drop shipping, emphasizing their Internet presence and facilitating it in their stores. They also earn $900 million per year returning about $800 million to their shareholders, most earned on the net. Costco #4 to #6 is also very profitable and saw their Internet sales grow 20% last year with the CEO talking about it for the first time. Walmart is in the hunt as #3 and now say they have made it a priority. Finally, my company sells all 4 in the online area and Amazon is the least efficient though very nice people.
    Aug 14, 2013. 07:53 AM | 3 Likes Like |Link to Comment
  • OfficeMax misses by $0.01, misses on revenue [View news story]
    It would be nice if these reports started with Y/Y analysis or at least mentioned them rather than just what analysts say, which is geared towards short term traders.

    On an absolute basis this is not bad news for the office chains since they have been stabilizing their businesses.
    Aug 6, 2013. 09:10 AM | 1 Like Like |Link to Comment
  • Why I'm Short Amazon - No Returns To Owners [View article]
    Great retailers know they rely on their suppliers for great deals. "All the money is in the waiting room," Sam Walton. Staples.com, Walmart.com, and Costco.com, hybrid retailers, 2-4 behind Amazon, pay in 30 to 40 days.

    They pay from 84% for Costco, to 45% plus for Walmart and Staples, to 15% for Amazon. They pay net 30-40, Amazon net 100 plus.

    Who would you support? See Paul Santos articles.
    Jul 16, 2013. 04:29 PM | 1 Like Like |Link to Comment
COMMENTS STATS
33 Comments
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