Tag Archives: Amazon

Amazon Is Driving The Final Nail Into B&M Home Improvement’s Coffin

It was one thing when Amazon was selling physical things, but the game changed the moment it started offering services, too. Ripples were promptly sent flying into all corners of the retail universe with the launch of Amazon Home Services in March 2015, and now that both mom-and-pop hardware shops, as well as national brick-and-mortar chains have had more than a calendar year to react to the changes, a definite trend has emerged.

Almost too predictably, that trend hasn’t seen Amazon move an inch from its position, while just about every other retailer scrambles to make up ground they never knew they had lost.

The latest and perhaps biggest domino in home improvement retail to fall to Amazon’s have-it-your-way style of concierge services is Lowe’s and its subsidiary furniture and lighting specialty brand, ATG Stores. Lowe’s announced that it had officially partnered with Porch to provide on-demand installation and assembly to customers who shop at ATG locations. While it might seem like a small move, Jay Rebello, vice president of emerging business at Lowe’s, explained that it’s a necessary step forward for hardware retailers that recognize the changing tides around them.

“Our partnership with Porch is a valuable asset and another way we provide personalized care and solutions to both our DIY and professional customers,” Rebello said in a statement. ”By offering the Porch Retail Solution on ATGStores.com, we believe customers will find the additional support they need to complete all of their home improvement projects.”

Make no mistake about it — the kind of service that Lowe’s, ATG and Porch are looking to offer is being seen less and less as a fringe offering among the consumers they serve. According to a study conducted by The Farnsworth Group, more than a third of millennial homeowners had consulted a home services website, like Angie’s List or HomeAdvisor, within the last 12 months, and that number dips to just 31 percent among 35-to-49-year-olds. In fact, 29 percent of 21-to-34-year-olds indicated that they were “extremely willing” to go to a digital provider for their home services, and a collective 76 percent were at least “somewhat willing.”

As usual, Amazon gets high marks for setting a trend that others follow, but the home improvement industry has certainly chosen a good time to collect itself to capture more of the market. Harvard University’s Joint Center for Housing Studies (JCHS) found last year that spending on home remodeling projects would increase 4 percent by Q1 2016, with sales of new homes, more often than not bought by young consumers buying their first houses, driving much of the surge.

“Recent homebuyers typically spend about a third more on home improvements than non-movers, even after controlling for any age or income differences, so increasing sales this year should translate to stronger improvement spending gains next year,” Chris Herbert, managing director of JCHS, said in a statement.

The bottom line? The sprawling brick-and-mortar store fronts of traditional hardware retail aren’t the place that young or even middle-age landowners first look to for installation or assembly help.

And it’s a mad dash for those business to get themselves up to speed. Wayfair, one of the most visible online home goods retailers, was quick to sign its own deal with Porch in April, and even Yelp got into the game with an update that lets users see price quotes for services from local handymen and women. To clear up any confusion over why so many brands are throwing resources at home services, Porch CEO Matt Ehrlichman didn’t shy away from naming the elephant in the room.

“If anyone tells you when Amazon enters their space that they were happy, they’re not telling the truth,” Ehrlichman told The Seattle Times. “But it’s been interesting because it’s actually galvanized everyone.”

Amazon’s rush toward home services has clearly steeled the legacy players in the home improvement space. It’s how their reactions will measure up to the online giant that could be harder to nail down.

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Amazon to build giant fulfillment center next to BNSF intermodal site

Amazon.com Inc. has plans to build a 800,000-square-foot fulfillment center adjacent to BNSF Railway Co.‘s Logistics Park Kansas City intermodal facility in Edgerton, Kan., the online retailer and state officials announced last week.

The fulfillment center, which is expected to employ 1,000 full-time workers, will pick, pack and ship large retail items to customers, according to a press release issued by Amazon.com.

The project is a joint effort of BNSF, the Kansas Department of Commerce, Kansas Department of Transportation, NorthPoint Development, KCP&L, city of Edgerton and Southwest Johnson County Economic Development Corp.

“The quality of the Kansas workforce and our central location in the heart of the nation contributed to [Amazon’s] decision to locate in Logistics Park Kansas City,” said Gov. Sam Brownback.

Working at Amazon is Hell. So What?

The New York Times just published an exposé of how difficult life is at Amazon. I suppose their goal was to make us feel bad for their poor employees. Now, to be clear, I’m happy to criticize Amazon when they deserve to be criticized–I completely disagree with their decision to not pay their employees during security checks–even though the Supreme Court agreed with them. I just don’t have a problem with a company that demands a lot from their employees.

Amazon corporate employees work long hours, don’t get fancy benefits and free lunches, and are expected to dedicate their souls to the company. It’s so awful that Amazon kidnaps people off the street and forces them to work for them. I mean, why haven’t police or the FBI broken down Amazon’s doors and freed these poor people?

Oh, I get it, because these people work there voluntarily. They work there because the paychecks they receive are worth the time and effort they have to put into the job. If it wasn’t worth it to them, they would put in their two week’s notice and quit. They would go get different jobs. If enough people left, Amazon would either change their culture or go broke. Neither appears to be happening.

In fact, some people seem to thrive on it. The New York Times states:

At its best, some employees said, Amazon can feel like the Bezos vision come to life, a place willing to embrace risk and strengthen ideas by stress test. Employees often say their co-workers are the sharpest, most committed colleagues they have ever met, taking to heart instructions in the leadership principles like “never settle” and “no task is beneath them.”

So many people would love to work in a place where everyone is on top of their game and dedicated to working hard. So many of our workplace struggles come from incompetent or uncaring co-workers. It would be a dream to have great departments.

But, surely, not everyone feels that way. Hence, the article. Dedicated and constant work can cause problems. An unnamed executive eventually developed an ulcer after constant work, including spending most of her vacation working.

Any company that could drive you to such extremes must be awful–except that she could have left at any time. It’s doubtful that there are no other companies out there that wouldn’t jump at the chance to snap up such a dedicated employee.

In fact, there are many other companies that demand and receive dedicated employees. The pay is usually good, and the experiences valuable. I once worked for a company that would receive 1,000 résumés a week when we were expanding. This was also a place where all the good parking spots were taken by 7:00 a.m. People worked long and hard. But the pay was great. The people were great. And people wanted to work there.

People want to work for Amazon as well. It’s not a surprise that they do. It’s a prestigious company with good pay and good people. If it’s hard to work there, it’s hard to work there. Plenty of people reading this article have worked or do work for companies that demand long hours and vacations filled with phone calls and emails. If it’s worth it to you, work there. If it’s not, find something else. It’s your choice.

 

 

Amazon’s NVOCC status opens door to new business, cheaper rates

Could Amazon’s business of reselling goods produced by Chinese manufacturers allow it to create a profitable niche in transporting those goods into the U.S. and possibly other markets? Some believe that is the reason the giant online retailer is the newest NVOCC in the trans-Pacific.

Amazon’s newly achieved non-vessel-operating common carrier status opens the e-commerce giant to tap a potentially highly profitable revenue stream by providing ocean shipping services to its Chinese vendors and increase its buying power with container lines.

For example, if Amazon buys a 40-foot container space from China to the West Coast for $1,000, it can sell each cubic meter of the roughly 60 cubic meters of space for $50, allowing it to make a roughly $2,000 profit on transport services for its Chinese vendors, which supply about 90 percent of the goods sold on its website, Steve Ferreira, founder of Ocean Audit, a Connecticut-based global ocean freight auditing service, told JOC.com. The average spot rate to ship an FEU from Shanghai to the West Coast is $1,377, according to a Jan. 22 reading of the Shanghai Containerized Freight Index, as displayed on the JOC.com Market Data Hub

“A larger percentage of (Amazon’s) Chinese shippers are sending small amounts of freight,” he said “The most striking thing is Amazon’s ability to co-op a lot of smaller Chinese vendors and make one huge vendor”

There’s another roughly $50 to $70 in related fees, from handling to bill documentation charges, which Amazon can add to each shipment, allowing the company to “double-dip on the revenue stream,” he said. Amazon could charge small Chinese shippers $10 to $15 less per cublic meter of cargo compared to the current market levels.

Those cost estimates don’t take into account a variety of charges, including loading charges in Asia, and U.S. and Asia drayage costs, Amazon would be hit with, said Bill Woods Jr., managing director and founder of America’s Sales Agency, a Rhode Island-based logistics consulting firm. When calculating those charges, Amazon’s profit on a FEU move it bought for $1,000 would be about $750, he said.

By either giving Chinese shippers container pricing at cost or more, Amazon can also improve its ability to get better rates from carriers since it will be purchasing more vessel space, Ferreira said. To gain greater purchasing power in the short-term, Amazon could give its vendors ocean shipping at cost for the first year and then charge more once they’ve become used to using Amazon as their ocean transportation provider.

The recently granted NVOCC license from the U.S. Federal Maritime Commission to Amazon’s Beijing-based subsidiary, Beijing Century JOYO Courier Service Co., sent ripples through the estimated $350 million forwarding industry and reignited speculation that Amazon is working to reduce its dependence on parcel giants such as FedEx and UPS. The license, first noted by Flexport, a San Francisco-based logistics start-up, is the latest sign of how Amazon is taking a more active role in transporting its own freight, after it purchased thousands of trailers for U.S. delivery and reports suggest it’s considering handling some its own air cargo.

Guess What? A “Traditional” Retailer Might Beat Amazon and Google at “Same-Day Delivery”

Much has been made of Amazon’s  race for same-day delivery and Google looking to cut them off at the pass. In fact, Google just revealed they have been testing their own airborne drone delivery system, dubbed Project Wing, that could deliver small items to customers. While Google and Amazon’s drones are still a few years away – these online giants are still going to need physical space from which to distribute. That’s a substantial capital expenditure.
What if then, there were a store that already had “distribution centers” all over the country from which they could offer same-day delivery right here and right now.
That store could be MACY’s
Macys
It is a known fact that they are piloting it in four markets. They are working with FedEx, UPS and eBay. They are adding all sorts  of  technology as part of the renovation of their New York City flagship store.
Got to remember, they own the “World’s Largest Store: it is not the WalMart Home Office store in rural Arkansas.
Yes, not everyone loves them (like my boss who bought a suit from them once and the threads came out); but they must have something going or they would not have lasted with all the competition.

Find out about Challenge and Fairpromise

Finding Holes In AMAZON PRIME

Not everybody is sitting around waiting for the Amazon DRONE to win the war.

But in the meantime they have lots of folks who are not very happy with Amazon .Start with publisher Hachette, who claims the retailer charges more for its e-books than it should, or refuses to ship non-virtual copies in a timely fashion. There’s also its shareholders, who are miffed that Amazon’s earnings weren’t as strong as they’d hoped for in the second quarter. Read lots more horror stories like class action suits.

Webgistics01

Riding to the rescue is Webgistix, which was founded in 2001 by Joseph DiSorbo, and was acqiured last year by Japan’s own e-commerce giant Rakuten. That company competes directly with Amazon for online sales and product fulfillment. Rakuten uses Webgistix for North American logistics, which includes everything from supply chain management to to freight oversight, and has recently launched its own two-day delivery service.

Webgististix claims to offer an alternative to Amazon’s hyper-competitive environment. And that appeals to some online retailers. 

Logistics and fulfillment are a complicated part of e-commerce. They involve everything from storing and locating items to figuring out the most expedient method for shipping them, as well as providing merchants with actionable information about the selling and shipping process.

Webgistix Fulfillment Centers
Webgistix Fulfillment Centers

 

The Webgististix network of centrally located fulfillment centers makes it easy to get your orders delivered to your buyers as fast as possible. Our fulfillment centers include:

  • 5 Locations in New York, Las Vegas, Atlanta,Reno and Scranton where Webgistix operates warehouses focused on B2C order fulfillment.
  • Fast and economical shipping using SmartShip a proprietary shipping analysis that gives you an inventory placement map based on your buyers and the Webgistix nationwide network of fulfillment centers.
  • Real time views into inventory at multiple locations and stock replenishment levels using SmartStock technology and services that streamline inbound inventory processes.
  • Tours are Available for qualified prospective clients. Hey does Amazon give tours?

Webgistix’ personal client support is what distinguishes us from other order fulfillment providers.

With a bare-essentials service there’s no client support to speak of…

With a bigger service you’re just one name in ten thousand…

But when you become a Webgistix client, you are assigned a personal support representative based in the same facility that you store your products. Most of our clients end up knowing their representatives by first name and in fact, consider them an integral part of their own team.

Innovation and Tech Companies Go Together

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Innovation is central to the success and continued growth of the technology industry. Without innovation, there would have never been an iPhone or a Kindle Fire HDX, Windows or app stores. Innovation and the ability for companies to go beyond what they know to try something new is what pushes the industry forward and changes how we view and interact with the environment around us. Still, real innovation is somewhat hard to come by in the technology industry. At times when one new company springs up to deliver something truly new and innovative, others will simply follow its lead in the hopes of getting a piece of the business.
Tesla makes really cool, high end, electric cars. Buyer get high end tech, but pays for it.
SpaceX makes rockets and space stations. Bet they get outsource work from NASA as US & Russia not buddies.
Amazon is cool, building high tech warehouses and buying drones.
Google is an innovator too. Just heard they want to start production on driverless cars.
Aereo is a big and innovative “Over-The-Air” Broadcaster. Supreme Court  is way behind them in thinking.
Never count out IBM. They have been at it a long time.
Nest is owned by Google. Watch for all kinds of cool things
Corning is an old, established company but it is an up and coming innovator: Gorilla Glass: tough yet beautiful;
Square is making mobile payments not square
Vidyo is all about video over wireless. They are doing stuff Cisco can’t seem to do.

SpaceX has successfully developed rockets that can enter space and carry equipment and other important cargo to and from the International Space Station. As NASA’s budget gets cut even more, expect SpaceX to play a crucial role in space missions. – See more at: http://www.eweek.com/cloud/slideshows/10-tech-companies-proving-innovation-isnt-dead.html?kc=EWKNLCSM04292014STR1&dni=121871773&rni=25583632#sthash.2TUI3ihI.dpuf

Drones All Over The Place

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In December, we talked about Amazon’s Drone Delivery System: What It’s All About

Also in December we talked about how Regional Shippers Pose New Threat to UPS, FedEx

We mentioned again the Amazon drone

While Amazon is piloting drone aircraft for package deliveries. A number of firms, especially in Europe, are working hard on the concept of driverless trucks.

So it shouldn’t really be any surprise that work is now also being on unmanned cargo and container ships as well.

News came out this week that Rolls Royce has been working on such a concept since late 2013. The research work is being performed under a project it calls Blue Ocean, and it has already created virtual-reality prototype at its research center in Alesund, Norway, that simulates 360-degree views from a vessel’s bridge.

Rolls Royce’s efforts are connecting to something called the Maritime Unmanned Navigation through Intelligence in Networks (MUNIN). The program is co-funded by the European Commissions and aims to develop and verify a concept for an autonomous ship, which is defined as a vessel primarily guided by automated on-board decision systems but controlled by a remote operator in a shore side control station.

MUNIN is a consortium of eight partners that have the relevant scientific and industrial background. The group is studying the operational, technical and legal aspects in connection with the vision of an autonomous ship.

Its web site says that “Solutions for an autonomous bridge, an autonomous engine room, a shore side operation center and the communication architecture linking vessel and a shore operator will be developed and verified” as a result of the program.

It hopes to develop a prototype ship that can be sailed by the end of 2015.

Of course, reducing operating costs is one big driver of the research. Ship crews can cost more than $3000 per day, and represent some 45% of total variable operating costs, industry experts say. Drone ships would dramatically reduce those labor costs.

Rolls Royce says that in addition to the labor savings, drone ships would be safer and more environmentally friendly.

Company drawings for the new ships show vessels loaded with containers from front to back, without the need for a “bridge” structure where the crew normally lives. Eliminating the bridge and all the other systems that support the crew (electrical systems, air conditioning, water and sewage, etc.) leaves more room for cargo or containers. Rolls Royce estimates that the ships would be 5% lighter before loading cargo and would use 12-15% less fuel.

Bloomberg notes the company’s Oskar Levander, vice president of innovation in marine engineering and technology, believes the unmanned ships might be deployed in regions such as the Baltic Sea within a decade, but that regulatory hurdles combined with industry and union pushback relative to safety and other issues will slow global adoption.

Unmanned ships wouldn’t even be legal currently, since there are standards in place for the minimum amount of crew different types of ships must carry. Organizations such as the International Maritime Organization, a group that is part of the UN, and others are involved in maintaining and potentially changing those standards. If a ship did not comply with existing crew standards, it would not be able to obtain insurance, and thus would not be able to sale.

It is not just big drones, but Monaco has small ones: Weevil drones – Weevil is in the trees, the palm trees that is. The French Riviera’s canarian palm trees are under attack from red weevils, which were first found as parasites in 2012 above the Jardin Exotique in Monaco. It transpired that Monaco was one of the last place to be invaded by the little red blighters with Cannes, Antibes, Nice and Cap d’Ail already affected. But the fightback is underway. The drones are coming. Monaco has an air force, and it’s spraying Monaco’s 276 canarian palms with an organic spray made out of mushrooms, which is evil for weevils, but nothing else. 

Now for some late-breaking stuff:

Facebook Inc is in talks to buy drone maker Titan Aerospace for $60 million, according to media reports.

The high-flying drones would give Facebook, the world’s No.1 Internet social network, the ability to beam wireless Internet access to consumers in undeveloped parts of the world, according to the technology blog TechCrunch, which first reported the deal late on Monday citing an anonymous source.

The effort would help advance Facebook’s Internet.org effort, which aims to connect billions of people who do not currently have Internet access.

Facebook declined to comment. Titan Aerospace did not immediately respond to requests for comment.

Titan is developing a variety of solar-powered “atmospheric satellites” according to the company’s website, with initial commercial operations slated for 2015.

EBAY Fights Back At Amazon

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I always regarded EBay as selling somebody else’s old stuff. But they are big in new stuff too. But instead of having to “check out” the seller’s reputation, it is a division of EBay who is the seller! Only a couple of the brands they deal with are Levi”s and Sony. They even sell tickets through STUBHUB   http://www.stubhub.com/. They are merging mobile payments and in-store experience. Guess they are the World’s largest store.
They have a lot of new selling ideas. A “wall”, not a storefront. It is a huge touchstone screen. It features a pen dispenser to use and select stuff to buy.
If there’s one thing about Amazon’s ultra-modern business that still seems old-fashioned, it’s the warehouses — and not just because of reports alleging Dickensian working conditions inside these massive distribution centers. Yes, these million-square-foot marvels of logistical engineering get orders out the door at stunning speed. But in a 21st-century economy where hierarchy is out and peer-to-peer is in, these centralized hubs feel like a throwback to the pre-networked world.

At least, this is the attitude evinced by eBay, which today announced yet another gambit to undermine its archrival by smoothing the paths that connect people to the stuff they want. Devin Wenig, eBay’s president of global marketplaces, says the company plans to expand its eBay Now same-day delivery service from just a handful to more than two dozen markets by the end of next year.

“Traditional retail isn’t going away. But it is transforming,” Wenig said in a statement in which he also claimed that 75 percent of what people buy is found within 15 miles of their homes.

To help speed that transformation in a way that could also take a chunk out of Amazon, eBay has acquired U.K.-based Shutl, a delivery startup explicitly designed to beat Amazon on the ground.
The eBay Now service — available in San Francisco, New York, Silicon Valley, and, as of today, Chicago — lets shoppers order from local chain stores such as Target and Best Buy through an app. Delivery is promised within an hour or so. In the cities where it’s available, the service seems like a win-win for both eBay and brick-and-mortar retailers, who together are offering a delivery option that Amazon does not — and that Amazon is poorly positioned to ever provide if it stays dependent on its large warehouses, operating outside of city centers.
But there’s a catch. At the moment, eBay Now deliveries are handled by couriers that eBay itself employs (though they do use their own cars). These couriers — valets, the company calls them — typically wait in parking lots near big-box stores until an order comes in. At this point, they effectively become personal shoppers, buying the items at the checkout counter and then bringing them to people’s doors.
While this personal service ensures a quick delivery, the economics are tough to parse. The delivery fee charged by eBay is five dollars, which doesn’t come close to covering the hour’s work needed by the courier to fill the order, even at minimum wage. Though eBay doesn’t say, it seems likely they would take a cut from each sale, but that would eat into retailers’ margins.

This is where Shutl would come in for eBay. Instead of sending out individual couriers on a piecemeal basis — a sort of command-and-control model — Shutl acts as a marketplace for independent courier services that are already out making deliveries anyway. Shutl works as a platform that pools whatever extra room those couriers have and tracks where they are. When an order comes in, Shutl’s algorithms figure out which courier hits the sweet spot of location, carrying room, and price for that order. All of which would ultimately be designed to cut costs for eBay by turning delivery from a one-to-one into a volume business.

Shutl isn’t commenting about the acquisition beyond the obligatory blog post. But Daphne Carmeli, founder of a Shutl competitor called Deliv, says on one level the economics are simple. Imagine a courier makes $20 per hour. If that courier makes one delivery in an hour, that delivery costs $20. If the courier makes two deliveries, the cost per delivery is halved.

“It’s sort of a difference of a private taxi to an airport shuttle,” Carmeli says. “When the economics are about pooling, it’s a much, much easier business to scale.”
Even if Shutl can turn eBay Now into a smooth-running same-day delivery machine that just breaks even, eBay will have a potent new tool for cutting into the one part of the online shopping experience where Amazon may struggle to succeed.

Amazon expects to crush all comers through its sheer size. So far, it’s a plan that seems to be working, at least in terms of sales. But profits are another story. The idea is all the money spent now on its monstrous infrastructure will create economies of scale for Amazon that will allow the company to eventually make stacks of cash by running a retail engine so ubiquitous and efficient that no one else can meaningfully compete.

Yet as powerful as Amazon has already become, nearly 95 percent of retail commerce still happens offline in the U.S. This is one among the many reasons eBay has been working so hard to position itself as more than an online auction site. By providing yet another way to network buyers and sellers, a Shutl-powered eBay is seeking another way to scoop up some of that market that Amazon still doesn’t own.

For its part, Amazon clearly recognizes it can’t just hunker down in its warehouses. Its trial run grocery delivery program is clearly a testing ground for its own peer-to-peer option. But the very structure that has let Amazon dominate also makes it less nimble. And in the race to become the most instant source of instant consumer gratification, being fleet of foot is one way to race ahead.

EBay needs to tout PayPal:  especially after Target and now Nieman-Marcus problems with hackers

Amazon’s Drone Delivery System: What It’s All About

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 Amazon CEO Jeff Bezos took to CBS’ “60 Minutes” broadcast on December 1 to talk about a new technology, called Prime Air. The idea behind it looks simple: Amazon would receive an order and then deploy drones to customer homes within as little as 30 minutes after the package was ordered. Prime Air is the next frontier in shipping technology, Bezos believes, and could dramatically change the way Amazon as well as United Parcel Service and FedEx operate. Bezos was bold enough to suggest that its drone delivery system could go into service as early as 2015. But even if it develops a practical drone delivery system, the Federal Aviation Administration and, no doubt, state and local officials, are going to want proof that the system can safely operate, especially in crowded urban areas. But if nothing else, Bezos’ drone delivery proposal got Amazon some extra attention during the holiday shopping season. Whether it’s a PR stunt or an opportunity for Amazon to change the world of shipping, the drone program is worth a closer look. Wonder if that drone attack last week in the Mid-East on a wedding party. Maybe it was Amazon delivering wedding gifts and the sender’s credit card was refused!