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The first word that comes to mind is autocannibalism.
Exactly. I recall reading/seeing a consultant paper about the Amazon business model and once the delivery and returns (high pct) cost and delivery costs their profit margins are something like 3 percent.
This is simply an incentivized way to push those costs onto someone else with likely the same level of 'success' by those choosing to do it as those in a pyramid scheme or those smart enough to read all the fine print on a rebate program which has a very low percent redemption rate.
It reminds me of a friend with finance background who tried the "Uber" driver experience and discovered after about two months that when everything was factored in he made about $7.5 to $8 per hour.
These are signs of major companies shedding/shifting the high distribution fixed asset, labor and operations cost onto someone else.
As for the drone deliveries, I can imagine they will try to bury in small print some clause removing them from any liability from accidents / damages to the purchasers property and wager if they have to carry liability insurance, the drone delivery costs will soon be much higher in relation to purchase costs.
Last edited by ciceropolo; 05-15-2019 at 10:34 PM..
Reason: additional content
When this bad idea unravels, Amazon will be hurt as much by it, as the workers who tried it. The whole thing sounds very undependable and impossible to tightly organize. I'd compare it to trying to herd cats. If I spent big bucks on a new camera or some such thing, I wouldn't want an independent operator bringing it to me in a junker car that might not even keep running long enough.
This is exactly what happened to me when the independent driver program rolled out last year (maybe 2017) through an app signup. Someone showed up at my doorstep looking halfway high and their car was on life support. There was no identifier on who she was. Not knowing who she was, I didn’t know why she was pulling up in my driveway. I saw her pull out my over $500 order from that sketchy trunk and literally thought, “that’s not what I pay Prime for.” Then with her stoned look, I called Amazon as soon as I had my items. She already had been late delivering.
Others must have called as well. That person disappeared after 2 weeks. We went from that to getting deliveries from a warehouse driver in a U-Haul van to now getting deliveries in the dark blue Amazon van (has the lighter blue Amazon smile on it). None of them look like they may be using the job to case your house. Bonus is that I can track the delivery through the app.
These articles vastly underestimate the barriers to entry anyone/everyone has to even come CLOSE to competing with Amazon and only focus on one aspect of their business. Remember that Amazon's retail business isn't all they do, they also have a very successful cloud computing business that is a huge cash cow and they're also buying out retailers (Whole Foods) and even getting into the lucrative pharmaceutical business. And their subscription services aren't going away any time soon.
You could argue their growth may likely slow in the coming years, but the "going downhill" description is far from accurate.
Since companies care most about profits and the customers care most about getting more and more for cheaper and cheaper, what happens to the worker doesn't seem to be a concern of either, which is a big reason why we're in the mess we're in.
If we weren't so greedy, Amazon and modern Walmart (not Sam's Walmart) wouldn't exist.
WE are the greedy ones? Really?
Wages and salaries have stagnated for decades. The cost of living keeps going up faster than any possible raises people get. The only way for most people to survive is by borrowing or cutting expenses elsewhere.
They'll turn their employees who:
* have to pay at least minimum wage
* are required by law to provide health insurance
* have normal costs of doing business paid
Into "independent contractors" who
* have no minimum wage
* have no insurance
* get to pay the normal costs of doing business that Amazon used to pay
No WONDER they're paying $10K. They'll break even in like 6 months. Then Jeff Bezos can have more money to buy another fling.
Google his new residence. It is no joke...we can say he isn’t hurting for money. 😁
This is exactly what happened to me when the independent driver program rolled out last year (maybe 2017) through an app signup. Someone showed up at my doorstep looking halfway high and their car was on life support. There was no identifier on who she was. Not knowing who she was, I didn’t know why she was pulling up in my driveway. I saw her pull out my over $500 order from that sketchy trunk and literally thought, “that’s not what I pay Prime for.” Then with her stoned look, I called Amazon as soon as I had my items. She already had been late delivering.
Others must have called as well. That person disappeared after 2 weeks. We went from that to getting deliveries from a warehouse driver in a U-Haul van to now getting deliveries in the dark blue Amazon van (has the lighter blue Amazon smile on it). None of them look like they may be using the job to case your house. Bonus is that I can track the delivery through the app.
Our Amazon is delivered by the USPS. Even on Sundays. Weird how they do things differently in other places
Our Amazon is delivered by the USPS. Even on Sundays. Weird how they do things differently in other places
I’ve seen USPS rolling around on a Sunday here and there, but not in my immediate area. Always had wondered why - mystery solved! We get Sunday deliveries as well, but from the Prime van. I get a delivery window as late as 8-9pm, even on Sundays, which has happened. I always go for fulfillment by Amazon with same-day, one-day, or two-day shipping unless I have no choice in sellers. It’s all typically free with Prime, with the occasional minimum $35 order to get the free same/one-day shipping.
From what I can tell, Amazon will make use of whomever is the best option in the local area, down to zones for larger metros. I currently live in the suburbs of a large city. Amazon has been rooted in this major metro area for a while in terms of fulfillment and distribution. When I lived in the city limits, USPS was the main delivery method used, sometimes UPS. The delivery windows were not nearly as wide as a result. I don’t recall having same-day shipping as an option either, just two-day, but I don’t think it was widely available at the time either.
There is a long thread about this already. A few people who drive Uber/Lyft gave some insight. It pays adequately for people who are in the right situation and understand the business.
You mentioned a lot of caveats and 'what-ifs'.
I estimate that only 5-10% of Uber/Lyft drivers are even making minimum wage once expenses are factored in. The rest are making below minimum wage, and some might even be making close to zero, perhaps even negative income.
But while there are those who might be making some pocket change at or just above minimum wage, the reality is that most drivers are simply beating up their vehicles and spending a heck of a lot of time chasing only a couple bucks.
Sure, maybe 1% of their drivers are making a reasonable living at the median American wage/salary, but that doesn't disavow the reality that the other 99% are doing quite poorly.
The reality is that they are not factoring in oil changes or the mileage they're putting onto their odometers which brings down the value of their vehicles astronomically. Uber/Lyft drivers are essentially providing fleet servicing to their respective companies free of charge whereas people driving for trucking companies or delivery companies like UPS or FedEx, or simply a guy driving a work van (electrician, plumber, etc.) are not paying for that maintenance and upkeep out of their pockets.
Wages and salaries have stagnated for decades. The cost of living keeps going up faster than any possible raises people get. The only way for most people to survive is by borrowing or cutting expenses elsewhere.
Out of touch.
We did however sell out our long term interests in favor of the cheaper goods possible. Many thriving businesses were put under by Walmart’s coming to a town. Some people protested because in the long run loss of small business and made in America products are bad for the working and middle class. But more people didn’t care about the long run or the big picture and wanted those cheaper Chinese goods. Most walked right past union workers protests as these Walmart’s were built with laborers who got no benefits and low pay (and not all legal either most likely) and again did not care what that disregard meant for their own and their children’s futures. That’s what he means by our greed. Maybe short-sightedness is a better word.
Walmart now uses contractors like Amazon does to deliver groceries. They also automated store pickup by bypassing customer service in favor of a giant in store “locker” which dispenses your order. These kind of piecemeal jobs like delivery are now the wave of the future I think, and will cut across all businesses, not just Amazon.
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