They might not own ships and vans, but it's still distribution. I imagine the manufacturer ships them to the regional Amazon warehouses, where hundreds of people frantically unpack and repack and courier on to the customer.

No one in a Scottish warehouse is going to be negotiating laptop prices with Sony. They just distribute stuff sent to them by head office, where the brains are.

Yeah, I didn't say that. I specifically said something else. What I think happens is Amazon's head office agrees a price with (for example) Sony's head office for PS3s. This doesn't go on in Scotland, or in some regional hub in the US. This happens at a higher level, either at continental level (i.e. Amazon EU with Sony EU) or possibly even higher. Both parties agree a contract, presumably with some account for variation in exchange rate & etc.

What happens then is the Amazon warehouse in Scotland goes to Sony's UK distributor and says 'OK we have an agreement with the head honchos for you to supply us N hundred thousand UK spec playstations at this price'. They get supplied, they sit in Amazon's warehouses, they get shipped out to customers.

Why on earth would head office want to get involved in how or where the UK warehouse gets it's stock from? No international company does business that way. You just can't. These things get devolved. This is true for the things Amazon's sells millions of pounds worth of a year - laptops, tablets, consoles, Hoovers, CDs, whatever. The rest is dealt with entirely at a local/national level.

But have you noticed something else - how little of the stuff Amazon sell is their own stock any more? Noticed how much of the stuff they sell is 'fulfilled by Amazon', how much of it is actually just Amazon acting as a broker? Amazon have been getting out of the nuts and bolts of retail for years. They don't want to faff about having to worry about the price of, I dunno, Peppa Pig bedsheets. They offer someone who is bothered about that the service of selling through the world's most popular online retailer, handle a bit of the paperwork and take a cut of the sale price. Minimum effort for decent profit. They've been reducing their costs for ages because they realised they don't have to deal with all that stuff, they can just offer a shop front and let other people do it instead.

For about the last five years, Amazon have been attempting as much as possible to do the exact opposite of what you claim they are doing.

I've noticed that. It's like Amazon is turning into a 'Buy It Now' version of EBay.

Or just Play.com

And they are cheaper than eBay much of the time?

Their profits are made in Luxembourg. If you look at he transactions you make with Amazon, they are all directly with Amazon in Luxembourg, not the UK.