The Flywheel & Amazon

Amazon's flywheel, low prices attract customers. More customers means more volume. More volume means better supplier prices. Better prices let them offer lower prices. More customers follow. Each turn makes the next easier. After a decade, the cost curve moved miles down. Competitors can't follow without the volume. The key is identifying which variable feeds which. Amazon new customer acquisition was first. Price mattered most. Then volume, then supplier negotiation. Once built, growth becomes exponential. Each customer reduces costs for all others. After enough time, your low costs structurally because of accumulated volume. This differs from optimization.