[cowsandmilk]

Except it has been for decades. In traditional retail, the split is 60% store, 40% seller. So your same $200 product would be $80 to the seller, not $88. And manufacturers have been operating with that split for a long time.

[cbsmith]

You're talking about gross margin/mark up, and there really isn't a "traditional retail margin". It varies a lot by product, but, as an example, the typical mark up for grocery stores is 15%. I used to do retail sales for appliances, including BBQs. The markup could get as high as 50%, even more for high end BBQs that sell in the $800+ range, but was generally more like 30%... and discount outlets or online retailers, it was much more like the grocery store mark up. A $200 BBQ with a markup of 150% like you're describing is not a thing I ever saw.

[megaman821]

Are talking about markup from cost of goods? The manufacturer costs usually take into account their overhead; assembly line, warehousing, transport, running the business, profit etc. Amazon is taking over some of those things for sellers, so yes they take a bigger percentage than a normal retail store.

[cbsmith]

Comparing to retail is not apples to apples. The overall margins on Amazon tend to be lower across the board. So, yes, there's a problem with comparing directly with retail in general. Amazon is taking on distributor costs, but they aren't really doing anything to reduce manufacturer costs. Manufacturers still need an assembly line, warehousing, shipping (to get it to Amazon), & running their business... maybe they're not getting any profit, but that's the problem we're talking about.

While amazon is covering their own warehouse & fulfillment shipping costs, that's really that different from costs normally borne by retailers who have warehouses and handle delivery to their retail outlets.

[cbsmith]

Should be: "that's NOT really that different from costs normally borne by retailers"