Pick any popular company that has information on the web you can search for. Page 1 cover page Page 2-3 Introduction to your company Page 3-5 Relate your company to the student learning outcomes for t

Running head: Amazon.com incorporated 0

Amazon Inc.

Matthew H Helsel

ECO203: Principles of Microeconomics

Abstract
Since Amazon began as an online bookstore in 1994, it has grown to dominate multiple markets and become the largest e-retail store in the world, and a huge employer in the United States of America. Amazon competes with major companies in each of the markets that it participates in and is always close to the top, if not number one. Amazon has entered multiple markets over the years, expanding over a wide selection of services that they offer and even seem to be aiming to be independently operated.
Amazon Inc

Amazon.com Incorporated (Amazon) is the second most valuable publicly traded company in the world, following behind Apple (Bach, 2018) and the second largest employer in the United States of America (U.S.), following behind Walmart (Fortune, 2018). Amazon has very few competitors and has been taking over the e-retail game for years, growing faster than any big company in the U.S. (Ramstad 2017). Amazon has a lot of control over pricing, beating out the competition. Amazon’s market structure is an oligopoly, a market dominated by only a small number of stores. These oligopolies maximize profits, set prices, and dominate the market.

Amazon is the U.S.’s biggest online retailer of cleaning supplies and home good, competing with stores like Walmart, Target, and Bed Bath and Beyond. When it comes to clothing and shoe retailer, Amazon competes with Designer Shoe Warehouse, Footlocker, and GAP. Moving onto a distributer of music, books, and television the company competes with Apple, Netflix, and Home Box Office. Over the past few years, Amazon has bought; the internet’s biggest independent online shoe store: Zappos, the biggest online diaper stores: Diapers.com, and the biggest online comics store: ComiXology. Amazon bought Twitch, a live streaming video game platform. Most recently Amazon bought Whole Foods Market, the U.S.’s sixth-largest grocery store, now letting Amazon participate in the $700 billion grocery-store business (Meyer, 2017). In most recent news, in early September of 2018, Amazon announced the order of 20,000 delivery vans from Mercedes-Benz. Amazon plans on using these vans for last-mile delivery, meaning getting the packages from a shipping hub to your house. Amazon has started to build its own delivery service, starting with their initial order of 5,000 vans that have been the trial of the service in Austin, Texas. Amazon’s goal is not to replace its competition, USPS, FedEx, and UPS in the newly entered delivery service, but Amazon will definitely end up relying less on other logistic companies (Mann 2018).

Amazon’s goals seem to not only dominate, but to own the market. Amazon, in short, is an everything store. Amazon lends credit, publishes books, designs clothing, and manufactures hardware. Amazon Web Services rents bandwidth and computer power to companies like Slack, Netflix, Dropbox, Tumblr, Pinterest, and even the Federal Government (Meyer, 2017). Amazon is big and is getting bigger every day, and with Amazon buying the competition, some would argue that Amazon is a monopoly, but it is far from a monopoly. A monopoly is a market structure characterized by a single seller, selling a unique product to the market, facing no competition. Amazon faces major competition in every market that it competes in. A few of Amazon’s major competitors are; Walmart, Apple, and Netflix. Amazon is growing fast, and will probably pass Walmart in the near future. If Amazon was a monopoly, it wouldn’t have low prices and would have no competition. Amazon is an oligopoly, a company inside of a market structure that only a few companies dominate. Amazon and its top competitors, compete with each other in the market. In 2009 Walmart announced that customers could buy selected hard cover books on Walmart.com for just $10, instead of the typical $25-$35. Amazon quickly matched Walmart’s price on the same books. Walmart responded by lowering the price to $9, and Amazon did the same. Walmart then lowered the price to $8.99, Target.com then matched Walmart’s price, and Walmart lowered the price another penny to $8.98. This makes it clear that the big companies are competing, while smaller companies cannot (McArdle, 2009). Amazon has even entered the delivery market. With the leading e-retailer expanding into the delivery business and placing twenty thousand delivery vans on order from Mercedes Benz (Mann 2018), Amazon is becoming more powerful and independent. Amazon is helping the economy by creating jobs even though this move will hurt other delivery services such as; USPS, UPS, and FedEx. Amazon has been expanding in unbelievable ways in our economy.

Conclusion

Amazon has been dominating the market for years and I cannot imagine a day in the future that Amazon is not the number one everything store anymore. The company is well known and a lot of shoppers first stop in online shopping. From personal experience, I know a lot of people that rely heavily on Amazon.com for all of their needs when we cannot get them elsewhere. Amazon is going to continue its growth and expansion as a company into different markets, and continue to dominate the e-retail market and one day surpass all of its competition. Amazon is headed in the direction of one day possibly being the United States top employer as well.

References

Bach, N. (2018, March 21). Amazon Passes Another Giant to Become The Second Most Valuable U.S. Company. Retrieved from http://fortune.com/2018/03/21/amazon-second-most-valuable-company-after-apple/

Fortune 500 Companies 2018: Who Made the List. (n.d.). Retrieved from http://fortune.com/fortune500/list/filtered?sortBy=employees&first500

Mann, D. A. (2018, September 19). Look out, UPS, FedEx - Amazon just ordered 20,000 delivery vans. Retrieved from https://www.cnbc.com/2018/09/18/should-ups-be-concerned-about-amazons-order-of-20000-vans.html

McArdle, M. (2009, October 29). Is Amazon an Oligopolist? Retrieved from https://www.theatlantic.com/business/archive/2009/10/is-amazon-an-oligopolist/29270/

Meyer, R. (2017, June 19). Is Amazon Already a Monopoly? Retrieved from https://www.theatlantic.com/technology/archive/2017/06/when-exactly-does-amazon-become-a-monopoly/530616/

Ramstad, E. (2017, October 23). Amazon is growing faster than any big company in the U.S. these days - and maybe ever. Retrieved from http://www.startribune.com/amazon-is-growing-faster-than-any-big-company-in-the-u-s-these-days-and-maybe-ever/450818013/