Online Shopping vs traditional shopping & why Online gaining!
Precisely on the 25th July 2015 Amazon eclipsed Wal-Mart with a share price of more than $250bn compared to Wal-Mart with a share price of about $230bn. Just to put these figures into perspective, Malta's GDP as of 2013 stood at $9.6bn. Just the gap between the two Retail giants is more than Malta's GDP recorded in 2013. Many people would turn around and say, but Wal-Mart also has a website and a nice one at that, how come it doesn't sell more than Amazon? After all Wal-Mart has 11,000 retail units under 65 banners in 28 countries and a website. Also Wal-Mart has been around since 1962 and Amazon has only been in operation since 2004! Yet Amazon is a force to be reckoned with!
Much like Amazon we operate on parallel modus operandi. His tag line "One million titles, consistently low prices!" We at Maltawarehouse take this to heart by blowing overheads out of our equations. Mr.Jeff Bezos at the time realised that if a person wanted a book, a book was a book. There's nothing attached to the book that a person may need to look, touch or feel before ordering. Simply the price! His genius was for seeing this opportunity way back in 2004. Keeping consistently low prices to make his clients loyal to his brand. Since this time the website has developed and diversified but a key factor to being able to keep his consistently low prices was because he did not operate a traditional business model! No He did not open a Retail outlet in every town corner and/or city centre-Unlike Wal-Mart.
Here at Maltawarehouse we understand this and operate under the same parallel vision.
Our clients here in Malta now know what Shampoo, Detergent and/or Deodorant they are looking for. There is no need for the added sensory of Look, Touch, Feel, Taste or Smell before they purchase the object as they are already completely familiar with the object! So we simply have to win our clients with Price! Convenience is also a huge added bonus.
Other retail outlets here in Malta cannot keep up with us simply because all other companies operate the Traditional business model. Retail outlets are very expensive operations. The big showrooms that these supermarkets operate are large capital investments.
Imagine very simply a large Supermarket and the investment made to buy and build the store would cost a modest EUR20,000,000.00 (EUR20million) and lets say they were being charged a low interest rate of say 2% interest per annum , We would be talking about a repayment of EUR33,000.00 per month for just the Interest! That's wages for thirty people every month! This money has to come from somewhere and this basically translates into the amount of profit these company need in order to stay in operation. We have just spoken about the capitol investment of operating space. Apart from that there are multitudes of other costs involved and all of these are added to each and every product you purchase when entering their establishments!
Another large price factor would be the huge electricity bills these large supermarkets rack up! Display fridges and freezers are renowned to be hugely inefficient. Aside from that the supermarket is all air-conditioned, sometimes colder than you might actually deem comfortable! Every product purchased has a percentage of electricity factored into them. Why should you pay more for a product when you never intended on using the service? In other words even if you never bought a single frozen pizza from the supermarket, you have indirectly paid the electricity bill for them buy purchasing from that establishment. Sounds crazy but its true!
Aside from that these retail shops employ a lot of staff which you are also paying for!
We at maltawarehouse.com operate a website and mobile app for both Android and Apple products. We are the cheapest online local company and will continue to do our best in doing so.
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