How Amazon Keeps Prices Down [INFOGRAPHIC]

How Amazon Keeps Prices Down [INFOGRAPHIC]

When you think online retailer, you think Amazon. They are the largest online retailer selling everything from computers to groceries. As consumers turn to online ordering retailers like Amazon have to keep their prices low, but when you’re a big company it can be hard to do that. One of the companies that has figured that out continues to keep their prices low by focusing on what they can save.

With an annual revenue of $48 billion, its income in larger than the GDP of some countries. And with 152 million customers you can fit them into the population of France, two times! With all those customers and merchandise that needs to be moved you better bet they have a huge warehouse. In total Amazon owns 18 million square feet of warehouse space, which is the same size as 313 football fields.

Amazon was founded at the perfect time because it was right after the U.S. Supreme Court ruled that online retailers didn’t need to collect sales tac in states where they weren’t physically present. This meant that they could locate with somewhere with low sales taxes and conduct business without having to worry about paying sales tax.

With all of that space, Amazon uses a lot of electricity to power its lights and systems that they have running. Amazon pinches pennies and does green things to save like taking light bulbs out of vending machines to save $20,000 a year. One very unique way of keeping profits high is how Amazon pays its executives. The CEO of Amazon is only paid $81,000 a year and doesn’t receive any stock awards. Bezos’s salary is only 0.6% of an average CEO in America, which is outrageous.

Sales for Amazon have been through the roof year over year and looks like the side of a steep mountain that keeps going up and up and up.

with all of those ups there are some downsides to being picky on your profits. In a recent survey Amazon ranked last amongst major companies in work-life balance. One significant incident that happened recently is in a warehouse on a 102 degree day, 15 of the 1600 employees at the warehouse collapsed from heat exhaustion while six of those went to the ER, all of them received disciplinary action for not working.

Overall, Amazon has grown into a very successful company but there have been some questions about its actions to help the company save many. Check out the infographic below by MBAOnline to see exactly what’s up with the company.

Click the image below for a larger version.