Californians, Say Good Bye to Amazon, B&H, Adorama,...

Don't know if anyone had posted it, but I heard from a colleague in CA that Amazon alone had 25,000 affiliates that will have its affiliate relationship terminated.

I have mixed feelings about Amazon's Affiliate program. On one hand, it allows anybody to build a store in about five minutes and, with almost zero overhead (including the overhead costs of accounting, set-up, marketing, warehousing, shipping, etc.) actually start a no-risk small business. It's a dream come true for entrepreneurs.

On the other hand, I don't like the idea of a single entity, Amazon, being the sole choice of online consumers who want a wide array of items. My wife has bought shoes and purses from endless.com for some time now and I only recently found out that they are owned by Amazon.

I don't know what the answer is. Amazon is getting a free ride off of the U.S.'s internet and shipping infrastructures and even the largest brick-and-mortar stores (Costco, Target, Walmart, Best Buy, Home Depot, Lowes) are having trouble competing, particularly in places like California where Amazon can offer a government subsidized (no sales tax) price discount.

An abhorrent solution would be for the government to control the nation's internet retail system. That sounds absolutely repulsive, but would that be much worse than our current system, where the largest corporations "own" our government?

Perhaps there should be a progressive internet commerce tax, where large companies that rely on the internet pay for the internet infrastructure in our country. A reliable high-speed low-cost (or free) internet is probably the most important factor in promoting the development of small businesses, education, training, and general employment in our country.

Last time we tried to screw you guys for taxes we lost a colony

neil_r wrote in post #12689627
Last time we tried to screw you guys for taxes we lost a colony

I had to look at your location....maybe its time again...

cacawcacaw wrote in post #12689590
I have mixed feelings about Amazon's Affiliate program. On one hand, it allows anybody to build a store in about five minutes and, with almost zero overhead (including the overhead costs of accounting, set-up, marketing, warehousing, shipping, etc.) actually start a no-risk small business. It's a dream come true for entrepreneurs.

I read one quote that the affiliates were paying somewhere in the neighborhood of $125 million in taxes...so know CA stands to lose somehwere between $400-$500 million (if you believe the numbers they were spouting that the tax would amount to)...and possibly put a number of folks out of business...

dog rocket wrote in post #12689323
So, if WalMart had your product locally for 5% less than your online mom and pop and you had to pay sales tax for both, you would still buy from online mom and pop?

Well lets see, I have to travel to WallyWorld @ $3-$4 gal gas (25-30 mile roundtrip), v's having it delivered to my door...local mom & pop win everytime...problem is it's usually not even close to 5%, more like 20%+ due to walmarts buying power..and their ability to dictate prices from the manuf...

dog rocket wrote in post #12689472
...Small businesses need every advantage they can get to stay alive and sales tax savings is a HUUUUUUUUUUUUUGE advantage for them there. ...

Our country is caught up in a vicious cycle.

With a political system where the largest corporations set the rules, we've been brainwashed to ignore our most precious resource, the very small business, and have stood by while our tax codes and justice system have been changed to accommodate the greed of the largest companies (which, due to economies of scale, already have a leg up on the competition).

Campaign finance reform could give us gutsy principled politicians but financial interests will spend billions to spread divisive untruths, foster fear and hatred, and make sure things stay just the way they are. I'm bummed that Amazon's California affiliates will no longer be paid to promote tax-free merchandise but I'm also encouraged by California's courageous step in the right direction.

digirebelva wrote in post #12689695
I read one quote that the affiliates were paying somewhere in the neighborhood of $125 million in taxes...so know CA stands to lose somehwere between $400-$500 million (if you believe the numbers they were spouting that the tax would amount to)...and possibly put a number of folks out of business...

Those numbers don't seem right to me. By firing its California affiliates, Amazon will still be able to offer tax-free items to Californians so only the affiliates' income taxes will be lost, right? (In a previous post, I noted that Amazon announcement seemed to be a scare tactic, so it would make sense that they would broadcast the most alarming possible scenario.)

If we did have a national policy, considering that virtually all on-line purchases are done via credit card, it seems that collection of state sales tax should be done by the credit card companies, based on the billing address of the customer. Easy peasy.

Hostages Trapped Inside Walmart Insisting They Never Shop At Walmart

neil_r wrote in post #12689627
Last time we tried to screw you guys for taxes we lost a colony

Meh. We then swiped your weaving technology to make cheaper clothing. We are even.

Well, they have to find money to cover a structural deficit. They did that to themselves.

gonzogolf wrote in post #12689383
who would buy pet food online when its more easily obtained locally?

Unless you are buying from a local pet specialty store it's crap anyway.

I would buy pet food online if there was not a Petsmart within 10 miles from me.

isoMorphic wrote in post #12690072
Unless you are buying from a local pet specialty store it's crap anyway.

I would buy pet food online if there was not a Petsmart within 10 miles from me.

But thats the point, there is a petsmart, or some local pet food store near you. It makes no sense to have 30lb bags of pet food delivered from an online retailer with shipping added in, even with the sales tax cost savings. You might be one of those 1 in 10,000 customers willing to pay a premium for a special brand, but for the most part enough big box retailers carry enough variety to satisfy the masses.

gonzogolf wrote in post #12690094
But thats the point, there is a petsmart, or some local pet food store near you. It makes no sense to have 30lb bags of pet food delivered from an online retailer with shipping added in, even with the sales tax cost savings. ...

Just as a hypothetical, if Amazon sold our brand of dog food at the same price as PetSmart (what an oxymoron!), say $60 a bag, I would get free delivery and a 15% subscription savings. That's $51, automatically delivered exactly on the day I need it, versus driving five miles to the pet store, lugging around a heavy bag, and paying $65 for the food. (Not to mention my wife's impulse purchases of pet treats, pet medicine, pet furniture, etc.)

Now here's the funny part. When I tell my wife that for $14 less, we could never run out of dog food and save her the trip to the pet store, she agrees with you, it doesn't make any sense to her.

cacawcacaw wrote in post #12690199
Just as a hypothetical, if Amazon sold our brand of dog food at the same price as PetSmart (what an oxymoron!), say $60 a bag, I would get free delivery and a 15% subscription savings. That's $51, automatically delivered exactly on the day I need it, versus driving five miles to the pet store, lugging around a heavy bag, and paying $65 for the food. (Not to mention my wife's impulse purchases of pet treats, pet medicine, pet furniture, etc.)

Now here's the funny part. When I tell my wife that for $14 less, we could never run out of dog food and save her the trip to the pet store, she agrees with you, it doesn't make any sense to her.

But can Amazon price match Petsmart, give you free shipping (its not really free, somebody presuming amazon is paying the freight) and still give you the subscription savings? The online pet supply store, the one with the sock puppet, couldnt do it and make a profit. Amazon can compete on lots of things, but my point is that for certain common products with low margins and high shipping costs online vendors cant compete. Amazon might be able to leverage their prices in order to meet your hypothetical, but this discussion started with supposedly small vendors competing, and they cant talk UPS down on shipping, or get a 25% reduction in wholesale costs like Amazon can leverage.

My affiliate accounts for Amazon.com, Endless.com, MYHABIT.COM, SmallParts.com (all Amazon companies) as well as Hayneedle have all been terminated.

The money I made was reported as income and I paid income taxes on it. The money I made was generally spent and put back into the economy through retailers as well as generated sales taxes. Now CA will not see a dime of that money. Not really a smart move IMO.

mmcguire wrote in post #12690308
Now CA will not see a dime of that money. Not really a smart move IMO.

Have you written to your governor and congressional leaders about it yet?