How to deconstruct the three core competencies of "low price, wide product selection, and fast delivery" using first principles?

Okay, let's talk about this topic. Imagine it not as analyzing a company, but as playing with building blocks. We want to construct three models: "low prices," "wide selection," and "fast delivery." What are the most fundamental, indispensable building blocks needed at the very bottom? This is what's called the first principles.

I. Deconstructing "Low Prices"

Ask yourself the most fundamental question: What is the prerequisite for selling cheaply?

The answer is simple: My costs must be lower than others'.

Alright, the next question is: How do I minimize costs?

Eliminate store costs: How much does it cost to run a physical store? Rent, renovation, utilities, countless salespeople... all of these ultimately get added to the product price. What if I just build a few super-large warehouses and ship everything directly from there? Instantly, the biggest chunk of cost is cut. This is the most basic building block.
Extreme operational efficiency: People get tired, make mistakes, and are expensive. So, I use machines. In the warehouse, robots sort and transport; algorithms plan the optimal route for each package. Minimize human intervention, shorten delivery times, and reduce error rates in every step. When efficiency is high, unit costs naturally decrease.
Huge economies of scale: If you buy one pound of potatoes versus ten thousand pounds of potatoes at the market, will the unit price be the same? Definitely not. When I procure millions of items from suppliers at once, the purchase price I get is rock-bottom. This bargaining power is unimaginable for a small shop.
Let sellers "compete": I don't just sell goods myself; I also open a platform, allowing thousands of people to sell their products through me. If you want to sell well, you have to be cheaper than the seller next to you, right? This way, I don't even need to lower prices myself; the sellers, in order to win customers, will drive prices down on their own.

So, "low prices" don't appear out of thin air. Its underlying building blocks are: "Warehouses" replacing "stores" + machine efficiency + purchasing scale + platform competition.

II. Deconstructing "Wide Selection"

Similarly, the most fundamental question: What is the biggest obstacle to having an infinitely wide variety of products?

The answer is: Physical space limitations and inventory costs.

Even a supermarket as large as Walmart has limited shelf space. If you stock ten thousand types of goods, half of them might not sell, leaving you with dead stock, which is inventory cost. How to solve this?

Make shelves infinite: Physical stores have limited shelves, but website pages are infinite. I can add an unlimited number of product pages, as many as I want. This is the concept of "cloud shelves," breaking the limitations of physical space.
Let others bear my inventory: I don't stock so much inventory myself. I still use that platform, letting thousands of sellers come and sell. Seller A sells screwdrivers, Seller B sells used books, Seller C sells rare stamps... These goods are all in their own warehouses; I just provide a place for display and transactions. I don't bear a single cent of inventory cost, yet I possess the sum of all their goods. My product selection instantly becomes massive.

So, the underlying building blocks of "wide selection" are: Infinite "cloud shelves" + "socialized" inventory. It's not about owning everything yourself, but about building a system that can connect everything.

III. Deconstructing "Fast Delivery"

The most fundamental question: To deliver quickly, what is the core problem to solve?

The answer is: Shorten the "time-space distance" between the product and the customer.

Think about it, how can a package get from Beijing to Guangzhou the fastest? Not by finding the fastest courier, but by having the package originate in Guangzhou from the start.

Build warehouses near your home: Instead of just one central warehouse in a country, establish countless large and small "front-end warehouses" in various cities, even suburbs. As soon as your order comes in, the system immediately calculates which warehouse is closest to you and ships from there. When the distance shrinks from thousands of kilometers to tens of kilometers, how can it not be fast?
Accurate prediction: Even more ingenious, through big data analysis, it can predict that users in Hangzhou might buy a lot of heaters in the coming month. So, a batch of heaters is preemptively transferred from a northern factory to a warehouse in Hangzhou. Before you even place an order, the goods are already "waiting" for you nearby.
Control the last mile: Courier companies sometimes "drop the ball," for example, due to overcapacity or misdelivery. What to do then? I build my own delivery team, from picking goods in the warehouse, packing, loading, and delivering to your hands, the entire process is controlled by my people. This maximizes the guarantee of timeliness and experience.

So, the underlying building blocks of "fast delivery" are: Distributed warehousing network + data prediction + self-built logistics. It solves not a "transportation" problem, but a "spatial layout" problem.

In Summary

You see, when you break down these three goals to their most fundamental level, you'll find they aren't some magical trick, but rather some very simple, very basic logic:

Low Price = Extreme cost control
Wide Selection = Breaking physical space, sharing inventory
Fast Delivery = Shortening spatial distance, optimizing processes

What's even more powerful is that these three building blocks can reinforce each other: low prices attract a massive number of users -> massive users attract a massive number of sellers -> massive sellers bring a massive selection of products -> massive order volume can further dilute warehousing and logistics costs, making prices even lower and delivery even faster. This forms a flywheel that spins faster and faster.

This is the skeleton of a business model seen from first principles.