@MarsC In most cases, I tend to agree with your statement about...

@MarsC

In most cases, I tend to agree with your statement about the difficulty of challengers to topple established players such as HVN.

However, in the Amazon case, I'm not too sure. Why? Because, with Amazon, we have a new competitor that is the least rational that HVN has ever faced.

Over its history, Amazon has shown again and again that it is more than willing to sacrifice profit in return for market share growth. Not only that, it is also willing to sustain considerable losses year in year out in order to establish its presence in a given market.

All of the online competitors that HVN has ever faced in the past 10 years in the local market are much smaller than HVN. This time, Amazon which has a market cap of US$400 billion compared to HVN's A$4.8 billion, is approximately 100 times bigger in market capitalisation.

Its system and logistic capabilities are probably more advanced than HVN's.

Are you sure that HVN will be able to deflect Amazon's attacks as easily as it had done in the past against much smaller challengers?

I am even worried that my favourite company, REH, will also be affected by Amazon's arrival! As you know, REH sells a lot of expensive power tools to plumbers. These products are high in value and small enough to be posted, exactly the type of market segment that Amazon is keen to attack.

Sorry for being your devil's advocate!