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Books-A-Million Inc. Message Board

  • xfein xfein Jan 11, 2000 2:45 PM Flag

    please post what solomon said about

    BAMM on 1/7/00
    I cant seem to log on if anyone could please post the analysts comments thank you

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    • eom

      • 1 Reply to dickerhoffbballking
      • BAMM: Holiday Sales Outstanding
        BAMM began fulfilling book orders for
        Wal-Mart's newly relaunched Web site on January 1. The
        company has invested heavily in expanding and automating
        its distribution capacity to support this business.
        All the distribution costs are included in COGS.
        Since the launch of Wal-Mart's Web site was delayed,
        there were lower sales from the business to leverage
        the increased distribution costs. However, as we
        believe higher overall same store sales will offset this
        effect, we are maintaining our gross margin projection of
        29.3% of sales. Wal-Mart has announced its intention to
        set up its Web operations as a separate public
        company. We believe BAMM will continue to perform
        fulfillment for the new entity. In fact, the establishment of
        the Internet operations as a separate company
        increases the likelihood that distribution will continue to
        be outsourced. The threat that Wal-Mart would some
        day internalize Internet distribution is
        substantially reduced. Additionally, we believe that
        substantial switching costs would accompany shifting
        distribution from BAMM to another provider due to the
        difficulty of systems integration. A further factor in
        BAMM's favor is its long established expertise in low
        cost book distribution. We believe that this advantage
        would be difficult for a competitor to o vercome.

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