Testing the Limits of Amazon Prime
Free shipping for a massive safe? Check
By John Johnson, Newser Staff
Posted Nov 29, 2012 5:04 PM CST
The Cannon Commander Series 54 safe.   (Amazon.com)

(Newser) – Subscribers to Amazon Prime shell out $79 to enroll and then enjoy the perk of free shipping. Eating the shipping costs isn't a big deal for the company if someone's buying a book or a pair of slippers, but what about a 1,600-pound safe? MarketWatch tracks down just such a beast from the Cannon Safe company: “We charge customers around $700 to ship this safe, but when they buy it through Amazon they get it shipped for free,” says its marketing manager. "As a result, we get orders through Amazon every day.”

That sounds great for Amazon, but consider that the company posted a $636 million loss on shipping in the last quarter, writes Jeremy Olshan. And its overall net loss of $274 million would have been a "hefty profit were it not for the costs of free shipping," one analyst says. “If I were an investor paying a multiple premium for Amazon, I’d want a little more information about this." Amazon is tight-lipped on such things as a general rule, but Jeff Bezos previously has said the company views free shipping as a calculated risk, one it is happy to take.

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Showing 3 of 19 comments
DougMasters
Nov 30, 2012 11:19 AM CST
" "hefty profit were it not for the costs of free shipping,"" Amazon.... this will be their contribution to the bottom dollaring that will hurt us in the long run. Free shipping on EVERYTHING! Companies need to make a profit for a reason. All business are trying to bottom dollar other business out, this lack of fundamental business sense is going to buttnail us in the long run,.
JoeQ
Nov 29, 2012 10:49 PM CST
If you've ever wondered what Amazon looks like: http://imgur.com/a/q1WIO
WarmWeatherGuy
Nov 29, 2012 9:03 PM CST
Because of Amazon Prime I go to Amazon first when I want to buy something. They get a ton of business from me that they wouldn't get otherwise. Not all of what I buy is heavy.