BORDERS BOOKS AND AMAZON.COM DECIDE TO DO BUSINESS TOGETHER
Borders Books, the leading chain of bookshop retailers, entered into an agreement with Amazon.com, the online retailer, to fulfill Internet orders from the Borders.com Web site. Using Table 15.3 and the following questions, what organizational form would you predict for this business relationship?
Questions
1. Are Amazon.com's warehouses, Web pages, and one-click sales methods fully redeployable to other products? If so, name a few such products. If not, why not?
2. Are Borders' fixed assets fully redeployable? If so, suggest how. If not, why not?
3. Is Borders dependent on Amazon as a unique complement? That is, is Amazon .com the only potential company that could process Internet-based orders for Borders?
4. Is Amazon dependent on Borders for referrals, or does it have its own Internetbased order flow?
5. Is your answer consistent with the multiyear fee-for-service contract between Borders and Amazon.com whereby Amazon processes the order, ships the book, records the sales, and pays Borders a referral fee? One Borders executive described this as a "low-risk, low-return" approach to online sales while retaining Borders' focus on its core mission of running bookshops.