According to the latest SEC quarterly report filed by Netflix, they spend about 10% of revenues on fulfillment. That is, "those costs incurred in operating and staffing the Company’s fulfillment and customer service centers, including costs attributable to receiving, inspecting and warehousing the Company’s DVD library."
I may not be reading the report right, but that sounds cheap. What do you think?
Click here for the PDF.
Perhaps it's because some of the expenses one might think of as being "fulfillment" - the cost of the DVDs themselves or the postage and packaging expenses - are in another line on that financial statement, the "cost of revenues/Subscriptions" at $97 million for the quarter (as opposed to the $17.5 million for fulfillment and customer service).
ReplyDelete