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For example, in its early years, Amazon offered 2.5
million titles, yet stocked only 2,000 titles (comprising about 5% of its orders) in its own warehouse –
a small (50,000 square-foot) facility in Seattle.iii The rest of its titles were sourced on an as-needed
basis only after receipt of a customer order. When Amazon received a customer order for a title that
was not in its own stock, it would submit a purchase order to a wholesaler. The wholesaler would
typically fill Amazon orders quickly, with shipments arriving at Amazon’s distribution center within
two to three days. As volume increased, Amazon opened direct accounts with publishers to obtain
better purchasing discounts...
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