Buying Ink

I recently needed ink for our printer at home and I set out on my usual journey to compare the price at two stores at which I usually shop. I drove to one and bought the ink at some discount with a coupon, but then for good measure I stopped at the second store to compare prices thinking I would return the earlier purchase if it was cheaper. It was roughly the same price there so I did not. With traffic this whole venture took me over two and a half hours to get the ink. Just on whim, I checked the price on Amazon and found the ink there for the same price that I had purchased ink at bricks and mortar store. So I could have ordered the ink on line in five minutes and had it delivered to my door for free, and saved myself two and half hours. Lesson learned. Amazon just made my life better.

The beauty of the free market is that entrepreneurs seeking to grow wealth have to make their customers better off at the same time. “It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own interest,” Adam Smith wrote in the 18th century. In March Amazon celebrated 20 years as a public company. If you had bought a $100 worth of stock in the initial public offering of Amazon in 1997 is would be worth more than $49,000 today. Wealth creation is the business of capitalism. Amazon grew from a market capitalization of $660 million to $460 billion in 20 years.

Founder Jeff Bezos said Amazon employees focus relentlessly on what its customers need, even if they don’t know they need it. That might explain how a company that started out as an online bookstore has become the most popular U.S. supplier of consumer goods.

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