In the late 90s, Amazon began expanding its offerings beyond books, quickly embracing the Internet and leveraging technology to boost sales and exploit dated tax laws. Thanks to the proliferation of the Web and a rise in the popularity of e-commerce, Amazon rapidly scaled its business to offer a range of products and services directly to customers anywhere in the nation.
The sheer breadth of the company’s reach provided a significant competitive edge over its local, brick-and-mortar counterparts. However, Amazon’s competitive advantage didn’t stop there. The Internet afforded the e-tailer the luxury of being “always on” and open for business 24/7, without all the costs associated with operating a physical storefront.
Furthermore, under the old tax regime, states could not force sales tax collection by vendors that didn’t have property or employees in the state. While its brick-and-mortar brethren were forced to charge consumers an extra 5-10 percent on goods and services, Amazon was able to get around the fees.
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BY jAN NUGENT | E-COMMERCE TIMES | ECT NEWS NETWORK
APRIL 1, 2019