The difference between $CHWY and Pets.com is....

[Pekelo]

Gen Xers vs. Millennials? So can a business idea revived and what failed 20 years ago be successful now? I always thought the pet store was the only store where everybody liked to go, because you can always check out the kitties, birds,etc. even the fish. On the other hand, delivering heavy dog food is usually a deal breaker. Thus Pets.com died.

But maybe I am wrong and Millennials don't have cars, or they don't want to carry dog food home?

 

[FriskyCat]

But maybe I am wrong and Millennials don't have cars, or they don't want to carry dog food home?

I believe this could explain some of it. (no cars)

 

[gaussian]

Gen Xers vs. Millennials? So can a business idea revived and what failed 20 years ago be successful now? I always thought the pet store was the only store where everybody liked to go, because you can always check out the kitties, birds,etc. even the fish. On the other hand, delivering heavy dog food is usually a deal breaker. Thus Pets.com died.

But maybe I am wrong and Millennials don't have cars, or they don't want to carry dog food home?

Chewy's pricing is extremely competitive. Some products are so much cheaper even after rolling in shipping and tax they still beat the local PetCo/PetSmart/etc.

Maybe a small group of people goes to pet stores to browse the pets, but for the most part pet owners just walk in, get what they need, and leave. As a millennial, I find myself interacting less and less with customer service in a meaningful way. They are a (very annoying) redundancy standing between me and what I already know I want.

 

[Stockolio]

In its filing, Chewy reported a net loss of $268 million on total sales of $3.5 billion for its 2018 fiscal year...

How do you make money selling a dollar for 90 cents ? Volume

 

[SteveM]

How do you make money selling a dollar for 90 cents ? Volume

Using shareholders as a piggybank

1) Get the CNBC/Cramer clown show to pump the "growth story"
2) Get the company added to a bunch of tech etfs
3) Let the Central Banks and pension funds balloon the share price, regardless of profitability
4) Allow insiders to cash out with millions from selling shares
5) Keep issuing more shares to keep the business running

 

[Pekelo]

Chewy's pricing is extremely competitive.

That is why they are losing so much money, 260 MM each year. Also, I never went to a petstore for petfood, the local grocery store sells it. So if I have a car and I am already shopping for my food, I can pick up the pet's food, no reason to order it online. (unless I don't want to lift an load dogfood or cat litter, the heaviest items)

I think Chewy's business plan works as the pets.com sock puppet sellers' on Ebay, $15-20 for the puppet, but $25-30 for delivery.

https://www.forbes.com/sites/greats...u-need-to-know-about-chewys-ipo/#47dded9c7266

"The purpose of this IPO is not to provide capital for Chewy, it’s an opportunity for PetSmart to cash out on its investment. The brick and mortar retailer is at risk of bankruptcy due to its high debt load, so it needs this cash infusion to survive."

Nice....

"Not only will PetSmart derive most of the benefit from this IPO, it will also maintain control of Chewy after the IPO is completed. PetSmart will still own 70% of the shares in the company and will control 77% of the voting rights due to Chewy’s dual-class share structure."

Double nice...

 

[vanzandt]

Using shareholders as a piggybank

1) Get the CNBC/Cramer clown show to pump the "growth story"
2) Get the company added to a bunch of tech etfs
3) Let the Central Banks and pension funds balloon the share price, regardless of profitability
4) Allow insiders to cash out with millions from selling shares
5) Keep issuing more shares to keep the business running

Exactly, but you left out one biggie.
It hits the mix somewhere between #3 and #4...

3.5) Let the world figure out how ridiculous the share price is (via #1 in reverse)... and then orchestrate the short squeeze from hell.**

**as $BYND hits $200 today

6) Set up next IPO and repeat.

 

[dickey7]

Exactly, but you left out one biggie.
It hits the mix somewhere between #3 and #4...

3.5) Let the world figure out how ridiculous the share price is (via #1 in reverse)... and then orchestrate the short squeeze from hell.**

**as $BYND hits $200 today

6) Set up next IPO and repeat.

Does #3.5 above mean the share price is ridiculously low, resulting in the short squeeze? I was thinking a short squeeze was when a units price went from low to high, resulting in the shorts covering which then drives price even higher...., eg. BYND

 

[zdreg]

In its filing, Chewy reported a net loss of $268 million on total sales of $3.5 billion for its 2018 fiscal year...

How do you make money selling a dollar for 90 cents ? Volume

Are you not familiar with the Trader's motto: Lose on every trade but make it up in volume.

 

[vanzandt]

Does #3.5 above mean the share price is ridiculously low, resulting in the short squeeze? I was thinking a short squeeze was when a units price went from low to high, resulting in the shorts covering which then drives price even higher...., eg. BYND

No. I was implying that when the shares are perceived to be "ridiculously high" (way overvalued), thats when many retail players step in and sell short the stock.

The rest of your statement is correct in what happens next. The stock starts rising, shorts panic and start buying... driving it higher and higher as even more shorts jump in. It can be deadly. That said, it can also be very lucrative if you can foresee it early on with the right stock and go long.