Chicago, IL (Dec. 27, 1999) -- Perhaps I just have a heightened awareness thanks to my Foolish vocation, but I'll be darned if I didn't see numerous gifts that originated from our Rule Breaking company (Nasdaq: AMZN) under every Christmas tree I visited in the past few days. Books, video games, DVDs, toys, and gift certificates -- I was amazed at not only the variety of things my friends and relatives ordered, but also at the quantity.

Online shopping was also a hot topic of conversation while feasting and opening gifts. There was a wide range of reactions I got to my probing, "How did you like it?" question. Some were ecstatic with the experience, while others weren't so pleased. By far, the largest complaint I heard from online shoppers of all types had to do with order fulfillment. Namely, the practice some online merchants have of saying an item was "in stock" or "will ship within 24 hours" when, in fact, the items were backordered. Toys 'R' Us (NYSE: TOY) had the most media attention with order fulfillment difficulties, but it seemed just about all the major online shopping sites were guilty of this to some degree.

Personally, I had a fairly good experience with all my online shopping. Beyond the handful of online gift certificates I ordered (which I have found to be popular gifts), I ordered a grand total of seventeen gifts online from four different merchants. Twelve of these items came from Amazon. All items that I was told would arrive in time for the holidays did just that, and that made me a highly satisfied shopper.

Between my own experiences and that of my extended family, I was quite happy to see that Amazon scored relatively well in the customer satisfaction department. In only a handful of cases did I find Amazon was a couple of days late in delivering items, which was far better than some of the horror stories I heard about some of Amazon's competition. I'm sure Amazon was far from perfect (feel free to share your own experiences on the Amazon message board), but it appears to this Fool that Amazon did considerably well given the crush of orders it had to fill. Overall, almost everyone I talked to was quite happy with their online shopping adventures, assuming they got their orders on time.

As someone who finds successful gift-wrapping an elusive skill, I especially appreciated Amazon's offer to wrap my gifts for me. It was worth every extra penny I had to pay (about $2 per gift), and was also extremely handy when shipping gifts directly to folks in other parts of the country.

So what does all this have to do with Amazon's stock today? Everything, in fact. If as a customer I had an overtly negative experience with Amazon, there is no way I'd own the stock. Plus, some of the most-valuable company research comes from using the products and services, not from just staring at financial statements.

One of the things I found from my hands-on research is that keeping promises of shipping times is of utmost importance for e-commerce merchants. A company that continually lies about its inventory availability is not going to survive very long. Plus, I think Amazon's large spending on automated warehouses is actually a good decision. First of all, this will give Amazon the ability to quickly fill orders in the future, which is obviously something consumers are demanding. Second, the warehouses should increase Amazon's overall efficiency down the road, helping quite a bit with the expense end of the income statements as the business continues to blossom.

I also believe that Amazon's ability to successfully fill orders will give it some moderate pricing power. Given the choice between buying an item at Amazon or, I would without hesitation pay an extra 5% or so on an order simply due to the fact that I know Amazon will do everything in its power to get the item to me in the agreed-upon timeframe.

In the short-term, Amazon should post an impressive top line for the fourth quarter. My own estimates call for Amazon to book somewhere around $675 million in sales in the quarter, which is above Wall Street's current line of thinking. I'm also estimating gross profits to be around $117 million (a 17.3% gross margin) and net losses to be $166 million (or $0.49 per share) before accounting for special merger costs. This loss expectation is slightly larger than the street consensus, but it seems obvious that order fulfillment and other overhead costs will see a modest spike relative to sales.

The fact that Amazon continues to produce copious amounts of red ink does not bother me as a Rule Breaker investor. Those holding Amazon today should be excited about what's to come five and ten years from now, not what the company will do in the next ten hours. Just like 1999 was a year of hyper growth for e-commerce versus 1998, I expect this time next year for Amazon to play an even greater roll in making boys and girls of all ages happy for the holidays. Couple Amazon's sweet market position with its efforts to increase efficiency and decrease costs, and I'm excited to see what Amazon will give its shareholders next Christmas.

Looking to the news of the day, you probably wouldn't guess by looking at the Rule Breaker's stock quotes that there was not any real news worth mentioning surrounding our companies. Some are worried about eBay's (Nasdaq: EBAY) increased competition in the form of Priceline (Nasdaq: PCLN), while others may be concerned about Amazon's impending losses. Whatever. And Celera (NYSE: CRA)? Well, that stock's performance over the past few weeks is just incredible, even though the company is essentially the same that it was a month ago. I continue to be amazed at how rapidly Wall Street's perceptions of these businesses can change.

Was Santa or the stock market very good to you this year? Please consider giving a little bit back to those in need via the Fool's charity drive. There's only a handful of days left in this year's drive!