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See Shasta

12/07/09 11:43 AM

#62389 RE: kozak667 #62386

Wow, thanks for sharing that!
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Joe Stocks

12/07/09 12:12 PM

#62392 RE: kozak667 #62386

kozak, Nice find. What bothered me about HD was that I had many peers that were driven out of business my HD. Many failed to change their ways and learn to compete better but others were excellent operations that could not compete with the mammoth HD selling merchandise at cost with the use of public money and that of their vendors. Once they drove many of their competitors out they raised prices. Back during their strong growth they had a gross profit of about 27%. Now that much of their smaller independents competition is gone they have raised prices and now have a gross profit of 33.5%. So,someone tell me how they made such good profits with a 27% margin and now profits are not quite so good with a 33.5% margin. HD raped the industry!

IMO AMZN is doing much the same with the smaller book stores. Once they are not able to extend their payables out further, and once the growth starts to flatten they will start to raise prices to meet earnings goals, but unfortunately it will be too late for many smaller operations. That is when we will see how good they really are.