---
created_at: '2011-04-21T05:44:08.000Z'
title: 'Thomas Friedman: Amazon.you (1999)'
url: http://www.nytimes.com/1999/02/26/opinion/foreign-affairs-amazonyou.html?pagewanted=all&src=pm
author: cwan
points: 99
story_text: ''
comment_text: 
num_comments: 38
story_id: 
story_title: 
story_url: 
parent_id: 
created_at_i: 1303364648
_tags:
- story
- author_cwan
- story_2469580
objectID: '2469580'
year: 1999

---
The other accouterments were just as cheap: He pays an Internet service
provider, ACES, $30 a month to house his very colorful Web site, and $30
a month to Americart to enable people to charge books on their credit
cards over a secure server line. He pays his bank $50 a month to manage
the credit card transactions, and has $40 a month printing costs,
largely for his own monthly book newsletter.

''I have no employees,'' says Mr. Bowlin. ''My daughter does the
accounting, I maintain the Web site and my wife does the shipping.
Altogether, I only need to generate $150 a month in profits to cover all
my expenses, and the rest is cream.''

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Once he was set up for business, Mr. Bowlin just spread the word among
his neighbors, colleagues and friends that not only could he offer them
everything Amazon.com did, but he could do it cheaper and make a profit
from day one. He now has customers from 23 states and Canada. It is
funny to go to his Web site and see it offering ''Millions Of Books At
Great Prices,'' knowing that it is all being done out of his spare
bedroom -- as a hobby\!

Here's the deal: Amazon.com offers ''The Testament,'' by John Grisham,
for 30 percent off retail ($19.57), plus $3.95 shipping and handling.
Mr. Bowlin sells it for 35 percent off ($18.17) and $2.75 shipping and
handling -- $2.60 less. How? Like Amazon, Mr. Bowlin buys ''The
Testament'' from the wholesaler for 44 percent off retail, but since he
has no overhead or advertising budget he can sell it for 35 percent off.
He can deliver the book through the U.S. Postal Service within three
days for only $1.63, so he makes $1.12 more on shipping for each sale.
Total profit: $3.65 per book. Plus, says Mr. Bowlin, ''when you charge a
book, I collect your money within a few days from Visa, but I don't have
to pay my wholesaler for that book for 30 days, so I have a free loan
which I earn interest on -- just like Amazon.''

Because his profit margins are razor-thin, Mr. Bowlin, like Amazon,
needs repeat buyers. Amazon gets them by offering useful information
about books. Mr. Bowlin does it by offering any government-certified
nonprofit organization a donation of 10 percent of the purchase price of
any book that any nonprofit or its members buy through him.

So the next time your broker tells you that this or that Internet
retailing stock is actually worth some crazy multiples, just think for a
moment about how many Lyle Bowlins there already are out there, and how
many more there will be, to eat away at the profit margins of whatever
Internet retailer you can imagine. It only costs them $150 a month and
they can do it as a hobby\!

Or think about it like this: For about the cost of one share of
Amazon.com, you can be Amazon.com.

[Continue reading the main story](#whats-next)
