The price competition is another sign of the multi-front battle between Amazon and the giants of American retail. Some, like Best BuyBBY +9.66%, have introduced price match guarantees promising customers to meet any Amazon price for items in their stores. Others, including Wal-Mart, are putting an increasing focus on their online operations, and using their networks of physical stores as distributed delivery points.
Most importantly, Amazon is gradually losing a price advantage it long enjoyed by not charging state sales taxes. While the company has done deals with a number of state governments to start collecting the taxes — including major markets like California, Texas, New Jersey and Florida — in states where it still does not collect sales tax it enjoys a 5%-10% “pricing advantage,” BB&T wrote.
I frankly see no evidence of this in the real world. Whenever I shop for something at a brick/mortar outlet, I check Amazon as well, and invariably, even with taxes, Amazon is cheaper. And Amazon always has a vastly wider selection of any given product sector.
I’ll cite Best Buy as an example: I often see something online – generally at Amazon – that piques my interest. But the vast majority of times I go to Best Buy to check out the physical goods, they don’t have it. I do buy occasionally at BB – usually items on deep sale discounts to clear them from stock. That’s how I got my Lenovo Ideapad Lynx for under $300, although at the time that was only seven dollars under the price it was on sale for at Amazon.