The Bank Of Amazon: How Long Will Suppliers, Sellers And Customers Keep The Doors Open?
by Timothy Phillips
It is becoming obvious that both suppliers and sellers are becoming irritated with Amazon's (AMZN) rate increases and strong arming on payable terms. A recent lawsuit filed in Washington state by Amazon marketplace sellers highlights the issues Amazon is having. This will prove to be a troubling trend for Amazon, as they have depended on the cash generated by timing of payments to fully fund operations. Over the past five years Amazon has generated a combined $9.3 billion in Free Cash Flow (Operating Cash Flow less Capital Expenditures). During that same time frame Cash Flow from payment timing (Payables plus Accrued Expenses less Receivables) has been $10.7 billion. This means that since 2008, Amazon has generated $10.7 billion through its "banking" business, and lost $1.4 billion selling products and services. read more »
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