Comparing two similar businesses; amazon.com and borders books - Research Paper Example

Borders’ shares traded at an all-time high of $44.88 on February 4, 1997. By the end on that decade, Borders had expanded into 256 superstores that had mean sales per square foot of US $256. However, the winds of change, increased competition, effect of poor investment decisions and other factors hit hard in 2007 when the company begun selling off its international subsidiaries and company stocks fell to a six-year-low of $12.28 per share (Bomey, 2011). Borders never recovered and spiraled to its liquidation in July 2011.
Amazon was started in 1995 by Jeff Bezos in a two-car garage in Bellevue, Washington. In May 15, 1997 Amazon.com went public (Amazon.com, 2012a). By end of 1998, the company had opened music and DVD stores and launched international sites in Germany and the UK. in 1999, due the company’s phenomenal growth that saw it include numerous services such as zShops, auctions and an array of products from electronics to toys to home improvement, the founder and CEO, Jeff Bezos was named TIME Magazine “Person Of The Year”. Amazon launched Web Services in 2002, the kindle in 2007 and by 2008 it had over 76 million active customers’ accounts and order fulfillment to more than 200 countries. An interesting fact is that whereas it took Wal-Mart 20 years to realize annual revenues of over US $5 billion, Amazon achieved this feat in 8 years (Amazon.com, 2012b; Chaffey, 2012). Amazon has moved from selling only online books to selling a wide array of products and services.
Even though both Borders and Amazon were founded with their core activity being the sale of books, the former chose to focus in its earlier products whereas the latter kept adding two new product categories for almost every year of its existence. However, it is neither the product focus of Borders nor Amazon’s diversified product base that explains there very different fortunes. Of course, one of the more obvious factors that led to the demise of Borders and the rise ...Show more