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The 20 Smartest Things Jeff Bezos Has Ever Said (NASDAQ: AMZN  ) was once the poster child of what happens when excitement about a company detaches from reality. The headlines "Amazon founder named TIME magazine's Person of the Year," and "Analysts Fear Amazon Is Going Bankrupt" appeared within 14 months of each other around the year 2000. Short of fraud, there little precedent for this in business history. 

But 13 years later, Amazon is thriving. It is dominating, in fact, including in lines of business having little to do with its original undertaking of selling books. Shares now trade for three times what they did at the peak of the dot-com bubble. 

Thank Amazon's quirky CEO, Jeff Bezos, for this success. He created a culture that's not only different from, but often totally at odds with, how most business leaders think. He's also quite quotable. Here are 20 smart things Bezos has said over the years. 

1. "All businesses need to be young forever. If your customer base ages with you, you're Woolworth's."

2. "There are two kinds of companies: Those that work to try to charge more and those that work to charge less. We will be the second."

3. "Your margin is my opportunity."

4. "If you only do things where you know the answer in advance, your company goes away."

5. "We've had three big ideas at Amazon that we've stuck with for 18 years, and they're the reason we're successful: Put the customer first. Invent. And be patient."

6. "I very frequently get the question: 'What's going to change in the next 10 years?' And that is a very interesting question; it's a very common one. I almost never get the question: 'What's not going to change in the next 10 years?' And I submit to you that that second question is actually the more important of the two -- because you can build a business strategy around the things that are stable in time. ... [I]n our retail business, we know that customers want low prices, and I know that's going to be true 10 years from now. They want fast delivery; they want vast selection. It's impossible to imagine a future 10 years from now where a customer comes up and says, 'Jeff I love Amazon; I just wish the prices were a little higher,' [or] 'I love Amazon; I just wish you'd deliver a little more slowly.' Impossible. And so the effort we put into those things, spinning those things up, we know the energy we put into it today will still be paying off dividends for our customers 10 years from now. When you have something that you know is true, even over the long term, you can afford to put a lot of energy into it."

7. "If you're not stubborn, you'll give up on experiments too soon. And if you're not flexible, you'll pound your head against the wall and you won't see a different solution to a problem you're trying to solve."

8. "Any business plan won't survive its first encounter with reality. The reality will always be different. It will never be the plan."

9. "In the old world, you devoted 30% of your time to building a great service and 70% of your time to shouting about it. In the new world, that inverts."

10. "We've done price elasticity studies, and the answer is always that we should raise prices. We don't do that, because we believe -- and we have to take this as an article of faith -- that by keeping our prices very, very low, we earn trust with customers over time, and that that actually does maximize free cash flow over the long term."

11. "The framework I found, which made the decision [to start Amazon in 1994] incredibly easy, was what I called a regret minimization framework. I wanted to project myself forward to age 80 and say, 'OK, I'm looking back on my life. I want to minimize the number of regrets I have.' And I knew that when I was 80, I was not going to regret having tried this. I was not going to regret trying to participate in this thing called the Internet that I thought was going to be a really big deal. I knew that if I failed, I wouldn't regret that. But I knew the one thing I might regret is not ever having tried. I knew that that would haunt me every day."

12. "We innovate by starting with the customer and working backwards. That becomes the touchstone for how we invent."

13. "When [competitors are] in the shower in the morning, they're thinking about how they're going to get ahead of one of their top competitors. Here in the shower, we're thinking about how we are going to invent something on behalf of a customer."

14. "A company shouldn't get addicted to being shiny, because shiny doesn't last."

15. "I think frugality drives innovation, just like other constraints do. One of the only ways to get out of a tight box is to invent your way out."

16. "If you double the number of experiments you do per year, you're going to double your inventiveness."

17. "If you never want to be criticized, for goodness' sake don't do anything new."

18. "If you're long-term oriented, customer interests and shareholder interests are aligned."

19. "Invention requires a long-term willingness to be misunderstood. You do something that you genuinely believe in, that you have conviction about, but for a long period of time, well-meaning people may criticize that effort. When you receive criticism from well-meaning people, it pays to ask, 'Are they right?' And if they are, you need to adapt what they're doing. If they're not right, if you really have conviction that they're not right, you need to have that long-term willingness to be misunderstood. It's a key part of invention."

20. "You want to look at what other companies are doing. It's very important not to be hermetically sealed. But you don't want to look at it as if, 'OK, we're going to copy that.' You want to look at it and say, 'That's very interesting. What can we be inspired to do as a result of that?' And then put your own unique twist on it."

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Comments from our Foolish Readers

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  • Report this Comment On September 10, 2013, at 4:11 PM, prginww wrote:

    This was great! I reposted it on FB for my friends to enjoy as well.

  • Report this Comment On September 10, 2013, at 11:12 PM, prginww wrote:

    Great quotes, always listen to and learn something from successful people if you want to be successful yourself.

  • Report this Comment On September 11, 2013, at 9:31 AM, prginww wrote:

    "There are two kinds of companies: Those that work to try to charge more and those that work to charge less. We will be the second."

    If you can pull this off you are both brilliant and a hero.

  • Report this Comment On September 11, 2013, at 9:44 AM, prginww wrote:

    Wisest Bezos quote: "It's harder to be kind than clever"

  • Report this Comment On September 11, 2013, at 10:35 AM, prginww wrote:

    Awesome post. Thank you! Inspires me to ask how I can innovate to better serve clients.

    Bezos (and other visionary leaders) appears to be a sharp contrast to Marissa Mayer.

  • Report this Comment On September 11, 2013, at 11:39 AM, prginww wrote:

    "There are two kinds of companies: Those that work to try to charge more and those that work to charge less. We will be the second."

    Bezos' goal is a more common one than it might seem. Costco is another such company. Focusing on market share over quarterly profit isn't that hard. Or at least it shouldn't be.

  • Report this Comment On September 18, 2013, at 1:49 PM, prginww wrote:

    Regarding Point 10. Consider A&P's gross margin % death spiral:

    The speed of A&P's decline was shocking. At the start of 1961, it was still the largest retailer in the world, with 4,351 stores selling an average of $1.2 million of groceries. It's profits in 1960 hit a record as a growing economy helped A&P achieve the highest sales in its history. Yet signs of rot were everywhere.

    John A. Hartford had always kept an eagle eye on A&P's gross profit - the difference between the amount it paid for goods and the amount it received by selling them. In the years before the 1925 reorganization gross profit had been over 20 percent of sales. For John, a high gross profit was a warning, a signal that the company was failing to hold down operating costs... By 1941 his constant push had driven gross profit down from 22 percent to 13 percent of sales, creating huge savings for A&P's customers and bringing in throngs of shoppers. In the 1950's, after John's death, gross profit began to creep higher, year after year. Gross profit was increasing across the industry, but the rise at A&P was especially steep. In 1968, gross profit would top 20% again. Its wide margins meant that A&P was no longer delivering bargains to shoppers, and shoppers responded, as John Hartford always feared they would, by taking their patronage elsewhere.

    At the store level, higher prices meant lower volume; dollar sales at the average A&P store would not exceed the 1960 level until 1969, and the company's total grocery tonnage would be lower in 1970 than it had been in 1952. Inventories were rising rapidly, a sure sign of poor management; by 1964, A&P's inventories, relative to sales, would be the highest since 1947...The company had lost its way...

    Investors abandoned the company that only a few years earlier had been a glamour stock...investment analysts called for A&P to raise prices.

    Tengelmann, a German grocer that was eager to expand in America, and that did not understand how far A&P had fallen bought effective control in 1979. The price set an implied value of a mere $190 million on a company that had been worth $1 billion twenty years earlier...A&P had all but destroyed itself.

  • Report this Comment On September 18, 2013, at 1:53 PM, prginww wrote:

    "Bezos' goal is a more common one than it might seem. Costco is another such company. Focusing on market share over quarterly profit isn't that hard. Or at least it shouldn't be."

    Simplicity is Genius.....or is it?

  • Report this Comment On September 24, 2013, at 10:45 AM, prginww wrote:

    These are great quotes. Can you provide any sources to prove that Bezos actually said them?

  • Report this Comment On September 28, 2013, at 4:10 PM, prginww wrote:

    21. This is the most Smartest Thing: Pay good salary to all employee !

    without this the others 20 will never work.

    Because the result of an enterprise when your employee cant have a decent life with his family will be, not future, not innovation, and of course, more poor people.

    Thank you Jeff, and king regards.


  • Report this Comment On October 08, 2013, at 5:27 AM, prginww wrote:

    Amen to "kewpiedoll"!

    Twenty comments are attributed to Bezos but NO sources are provided for ANY of them!

    Morgan Housel seems to be "the resident scholar" of TMF. Is this acceptable in "academia"? It's NOT.

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