
How Amazon’s ambitious new push for same-day delivery will destroy local retail - rmason
http://www.slate.com/articles/business/small_business/2012/07/amazon_same_day_delivery_how_the_e_commerce_giant_will_destroy_local_retail_.html
======
wheels
Amazon has been doing this in parts of Germany since 2009. The results haven't
been nearly as dramatic as the article predicts. As others have indicated, the
limiting factor isn't so much speed of delivery as the inclination to
physically inspect items before buying them. That said, Zappos, now a part of
Amazon, has succeeded in doing that in one of the markets that tends the most
towards such. Even so, there are still a lot of places to buy shoes.

~~~
cglee
When Zappos first came out I thought they'd tank. I purchase new
basketball/running shoes every 6months, and never ever make a new purchase
without trying it on. Playing basketball or running with an even slightly
uncomfortable shoe can lead to blistering, back problems, ankle sprains, etc.

But my gf at the time thought it was brilliant. What I learned was that a lot
of women's shoes are purchased based on anything except comfort. The quality
can be shoddy, the wear can cause excruciating pain, yet some top brands sell
for hundreds and even thousands a pair. Swing by the Nordstrom's women's shoe
dept sometime and take a look at the quality of build. Eavesdrop a bit and
take inventory of the questions the clients ask about. (Zappos is started by a
bunch of ex-Nordy folks).

To this day I've only purchased 1 pair of shoes on Zappos, and that's after I
had bought it previously at the dept store (New Balance 993, imo best shoes
for walking/running in case you're wondering).

~~~
arjunnarayan
Yes. The build quality of women's shoes is astoundingly bad. Sometimes I look
at them and they literally feel like glued on piece of leather, pretty on the
outside, and nothing more.

It's interesting how two different markets have developed (men's shoes and
women's shoes) that have such different parameters. Men's shoes have
outstanding build quality --- to the point where a good pair of quality shoes
gets resoled multiple times. Do women ever resole shoes?

~~~
diffeomorph
This isn't just true for women's shoes, but women's clothing in general. I
don't understand the reasons, but men's clothing tends to be made with less
design and more durability.

A fashioner designer once told me he made the men's clothing first, then
crafted the women's clothing out of its leftovers + some embellishments.

~~~
tsotha
Women's fashion changes quickly, so if she keeps up she may only be wearing
whatever it is for a single season. It doesn't make sense to make something
durable if it's only going to be worn a handful of times.

Men's fashions change much more slowly, and within much narrower parameters.
It actually makes sense to spend a few grand on a suit that you're going to
wear to work every week for a couple years, and it has to be pretty well made
to last that long.

The hipster doofus stuff is as shoddy as women's wear and for the same
reasons.

------
Caerus
> Amazon has long enjoyed an unbeatable price advantage over its physical
> rivals. When I buy a $1,000 laptop from Wal-Mart, the company is required to
> collect local sales tax from me, so I pay almost $1,100 at checkout.

This is such an over blown argument. Sure, Amazon is ~7% (where I live)
cheaper than traditional stores due to sales tax. But that $1000 Wal-Mart
laptop has a $900 sticker price on Amazon, and most non electronic items are
20-40% cheaper than in stores.

If laws change and I have to start paying sales tax on Amazon, it won't change
a thing about my buying habits.

Edit: They also have an inventory many times larger than any brick and mortar
store. Whenever I go shopping, I have to choose between the least crappy
option Wal-Mart decides to stock. On Amazon, I get exactly the one I want.

~~~
suresk
Indeed, when you look at surveys that ask people why they prefer shopping
online, things like "24/7 convenience", "saves time", and "better selection"
usually end up ahead of "costs less money, even after shipping" and taxes are
usually a small part of that.

The lack of sales tax hurts local tax entities far worse than it hurts
Amazon's competitors.

~~~
vaksel
not having to drive to the store is huge

on Amazon you just search, compare, read reviews and click buy.

with brick and mortar stores, you have to drive to the store, park, then roam
the store to find what you are looking for, then hope that they have it in
stock before you buy, then drive back home. Even a small purchase ends up
costing you an hour of your time.

and for large purchases almost always you have to wait 20-30 for the store
associate to bring out what you want to buy...and you have to deal with a
sales pitch for an extended warranty

~~~
cglace
Maybe for electronics but for clothes I don't mind driving to the store.
Trying stuff on till I find what works. Asking knowledgeable staff for
suggestions/opinions.

I think I've had one positive result from buying clothes online.

~~~
GFischer
I have an idea for a side project/startup tackling that problem.

What's your main problem? Finding out how it would look on you? How it
feels/quality? What are the suggestions and opinions you look for?

Thanks :)

~~~
cglace
All of the above are problems.

Huge problem is fit. Especially pants. So many things can go wrong. Too tight
in the thighs, pants run short, pants are tighter than usual in the hips,
weird fit in the butt, etc. . .

Feel/quality is a big one for me personally because I have some hangups with
textures. If something has a certain feel it makes my skin crawl.

As for suggestions and opinions, I'm usually looking for advice, make sure I'm
not committing any faux pas with my choices. For example, when buying some
leather shoes I may want something that can be worn with jeans or with slacks
if needed. If the sales associate is knowledgeable I will probably go with
something I initially was tentative about or didn't consider.

Hope that helps.

~~~
GFischer
It does :) . Thank you ! As soon as I have an MVP I'll post it here on Hacker
News :) .

~~~
BHSPitMonkey
Send out measuring tapes for free to customers (like Square's credit card
readers). The tapes will be branded with your logo/URL. You let users store
their exact measurements on their profile, and your company takes care of the
rest (building an online catalog of well-photographed stock, all of which your
team has gathered samples of and tested for exact measurements.

------
CitizenKane
This is already happening in China. Because of the nature of shipping
companies here it's not unusual to buy a product (typically off of
<http://taobao.com>) and get it later that day or the next day. Many of these
businesses are based in Shanghai and if you live there delivery happens nearly
instantly. One online shop, <http://cheers-in.com/> delivers cold beer in
Shanghai in 1 - 2 hours from an order. Stuff like this is absolutely fantastic
and it would be amazing to see it come to the US.

~~~
msutherl
Great for consumers like us, but terrible for all of the people who work
ridiculous hours under constant stress on warehouse floors or do deliveries
day in and day out. I try to buy from brick & mortar shops purely because
running a shop is a job that has a shred of dignity left in it.

~~~
icebraining
Yes, everyone who deals with the general public knows how unstressful and
dignifying that is. That is, besides having to deal with blatant sexism[1],
extreme ignorance[2], elderly genitalia[3], stealing[4], destruction of
property[5], physical violence[6], bigotry[7], etc.

[1]: [http://notalwaysright.com/man-up-and-let-a-woman-fix-
it/2136...](http://notalwaysright.com/man-up-and-let-a-woman-fix-it/21360)

[2]: <http://notalwaysright.com/spyware-is-strength/21253>

[3]: [http://notalwaysright.com/at-least-we-know-her-natural-
color...](http://notalwaysright.com/at-least-we-know-her-natural-color/21093)

[4]: <http://notalwaysright.com/to-conjugate-a-thief/20886>

[5]: <http://notalwaysright.com/customers-can-be-tiring/20828>

[6]: <http://notalwaysright.com/cuffed-red-handed/20707>

[7]: <http://notalwaysright.com/bigotry-gets-served/20336>

~~~
megablast
Right, so you have 7 links to the same site, all written from the point of
view of the wronged assistance. Wow. If that is not proof of nothing, then I
do not know what is.

~~~
schiffern
Who else but "wronged assistance" would demonstrate their point?

When you talk about conditions at Amazon warehouses, I assume you're referring
to this article (or similar):
[http://www.motherjones.com/politics/2012/02/mac-
mcclelland-f...](http://www.motherjones.com/politics/2012/02/mac-mcclelland-
free-online-shipping-warehouses-labor)

You should know that Amazon bought Kiva Systems earlier this year, so they'll
be replacing human picking with efficient robot picking over the next couple
of years.

Your job becomes to stand there on a foam mat and move whichever item the
laser points at from the cart to the box. This job will almost certainly be
automated in the next decade as well, with something like FlexPicker.

Kiva Systems: <http://www.youtube.com/watch?v=gvQKGev56qU>

FlexPicker: <http://www.youtube.com/watch?v=xHuDvVa7mkw>

------
fsckin
Amazon failed to collect/remit ~270M in sales tax in Texas and has owed
millions for years. So what did the state of Texas do about it?

They struck a deal to erase the 270M owed, as long as Amazon starts collecting
sales tax starting 7/1, create 2000 jobs and invest 200M in Texas. They were
likely already planning more infrastructure in Texas, but threatened to
reverse course and pull out of the state entirely.

The way I see it, Amazon bluffed the state of Texas to the tune of 270 million
dollars and all I might get out of it is next day delivery?

I'll take what I can get, I guess.

~~~
tsotha
Companies are only required to pay state sales tax if they have a physical
presence in that state. Amazon wasn't bluffing, Texas was. We went through the
same thing in California. Amazon agreed to pay the sales tax, but only after
it had decided to open distribution centers in the state.

~~~
fsckin
Amazon has had a continuous presence in Texas from 2005 onward.

Distribution center operated in Irving, TX from 2005 through 2011. Woot, in
Carrollton, TX was acquired in 2010.

~~~
Kadin
I think the distribution center was owned indirectly, through some sort of
holding company; that was the linchpin of their whole argument.

Woot was probably just one of the things they were threatening to close down
and move out of state if Texas didn't give them a break. And I'm sure they had
an argument ready as to why Woot wasn't a tax nexus for Amazon as a whole;
there's a lot of really arcane rules that go into determining nexus.

The real losers at the end of all this are going to be the tax-free states,
who ended up getting a lot of Amazon (and other mail-order retail) business
because putting a warehouse there wouldn't risk triggering taxation. But if
the tax loopholes are closed, there's not a lot of reason to set up shop
there. They are going to be the losers in the end, I think.

------
PaulHoule
A general policy that "online stores pay sales tax" also benefits Amazon vs.
small internet retailers.

A while ago I sold a few bumper stickers online and ended up using cafepress.
I could have made a better profit by printing the stickers in bulk and mailing
them to people, but I'd have to spend $100+ on paperwork just for the
privilege of paying sales tax just in case I sell any to New Yorkers.

If small internet businesses had to pay taxes to the 40+ states that have
sales tax plus to all the other jurisdictions (cites, counties, who knows
what) in the U.S. it would be almost impossible to sell stuff and comply with
the the law.

For AMZN the overhead is nothing.

~~~
einhverfr
Actually a general policy that "businesses that deliver things pay sales tax
per jurisdiction that they deliver thins to" (the way "online stores pay sales
tax" is implemented) benefits Amazon vs small local retail stores that
deliver.

Where I usually live in the US, there are at least 6-7 tax jurisdictions
within 20 min. by car. For businesses in Wenatchee that may deliver within an
hour's radius, there are a very large number of tax jurisdictions. Most brick-
and-mortar businesses ignore the rule and figure if they don't tell the state
they are delivering things, they won't get looked at too closely, but it means
they are in violation of the law.

------
ddt
It'll destroy larger B&M stores but I doubt it'll fully outdo local specialty
shops. What you'll see is a stratification between hyper specialty B&M that
sell luxury items only a tiny subset of people want, but are willing to pay
out the nose for, and places like Amazon filling the role of Target and
Walmart, being the catch-all for everything else that most people need on a
week-to-week or month-to-month basis. While you might be able to buy a certain
brand of organic mustache wax on Amazon, I don't see a day coming where
they'll be able to do that same-day.

~~~
earl
Also, amazon is kind of skeevy; I'm very leery of buying food, cosmetics, or
toiletries from them because they make it really hard to tell from whom you're
buying stuff. I'm happy to buy eg usb cables from the cheapest vendor, but I
don't trust any of the chinese knockoff shit if it's going to regularly touch
my skin or be eaten. Particularly since china appears to have no real food
safety laws and poisoned 300k of their children [1] with the same well known
techniques used to fake out protein readings on milk they used to kill
thousands of american pets [2] the year before. China even went so far as to
hurt more children by delaying a recall to avoid embarrassment during the
summer olympics! If I'm going to buy food or cosmetics on amazon, they need to
be much better about communicating from whom I'm purchasing and what was done
to make sure it isn't a knockoff.

And knockoffs are everywhere on amazon's site. I've wanted one of these cool
suck.uk bottle opener keychains that looks like an old school key for a while
[3] but their shipping charges to the US are too expensive. So I found it on
amazon [4]. If you read the reviews, it's full of complaints about knockoffs
or the steel snapping. And I've seen it sold for as little as $2.99 with
shipping while amazon sells it for $9. Adding to the skeeviness, the cheapest
vendor of that item changes all the time, and for quite a while amazon didn't
sell it directly. I finally bought it from amazon proper and I'm hoping they
got the actual item and not some knockoff themselves, but who knows. Shit like
this makes it hard to be willing to buy food on amazon.

[1] <http://en.wikipedia.org/wiki/2008_Chinese_milk_scandal>

[2] <http://en.wikipedia.org/wiki/2007_pet_food_recalls>

[3] <http://www.suck.uk.com/products/keybottleopener/>

[4] [http://www.amazon.com/Suck-UK-Key-Bottle-
Opener/dp/B0000B0DK...](http://www.amazon.com/Suck-UK-Key-Bottle-
Opener/dp/B0000B0DKM)

~~~
rdl
They show the seller, and I agree a lot of the Marketplace sellers are
horrible. I pretty much stick to Amazon.com LLC (i.e. real Amazon) and trusted
sellers (Adorama, J&R, ...) for most products.

I wish there were a way to set a flag in your account to ONLY show Amazon.com
LLC products.

~~~
earl
They show the seller, kind of, but say the seller is rightguard. Is it the
deodorant brand or is someone camping the name?

~~~
rdl
The seller is listed separately from that. e.g. for
[http://www.amazon.com/OXO-Grips-Silicone-Pastry-
Brush/dp/B00...](http://www.amazon.com/OXO-Grips-Silicone-Pastry-
Brush/dp/B000JPSI8C/ref=pd_ys_sf_s_1055398_b1_2_p)

Manufacturer is OXO, but it says "In Stock. Ships from and sold by Amazon.com.
Gift-wrap available." below the price. That means it's sold directly by
Amazon.

You can also go to "more buying choices" where it is even more transparent.

------
tomfakes
I bought 2 things on Amazon this week, both with free 2 day shipping with
Prime

Item 1 spent 13 hours on a UPS truck driving around my city and was delivered
about 7pm in the evening 2 days after ordering.

Item 2 was delivered 14 hours after purchasing by Amazon Fresh at 9am.

For the same price of shipping, which service would you rather have?

EDIT To Add: The delivery guy for the 14 hour item works for Amazon - the
whole experience was produced by Amazon without needing a third party. UPS is
another company that will be in trouble if Amazon can make this scale.

~~~
PotatoEngineer
It depends on how well I know the item. If it's a commodity where I've bought
exactly the same thing before (Charmin Extra-Strong Toilet Paper), then price
rules all. If it's a new item that I'm not sure what I need about it (chef
knife, bar stool, etc.), then seeing the item in person helps determine which
item I need.

~~~
jaggederest
I'm not sure if you've used Amazon's return system before, but it's absolutely
immaculate. In my opinion, this is more an issue of perception than reality -
in many ways it's easier to return things to Amazon than to your local store.

~~~
adestefan
Except for the times they charge you $8 for return shipping on a $5 item.

~~~
mh-
I've never been charged for return shipping. was this purchase an item sold
_by_ amazon, not merely fulfilled by them (a la amazon marketplace)?

~~~
Kadin
Amazon charges you for return shipping (or obliges you to use your own
shipping, e.g. USPS) depending on the reason you are returning an item. If you
are returning it just because you decided you didn't want it, they don't pay
to take it back.

That was my experience with some housewares stuff, about three weeks ago. I
decided to take the item down to the Post Office to ship it back rather than
using Amazon's label, because it was cheaper that way. (If I'd used the label,
they would have deducted $8 or something out of the amount they were going to
refund me eventually; USPS was something like $4-5.)

------
mthoms
This is the trojan horse. Once Amazon has a large presence in each major
centre, the next logical step for them is use some of their massive space as a
showroom (think Ikea but on a much larger scale).

[Edit: To clarify, the showroom and warehouse would be in the same complex but
separated. Shoppers + heavy merchandise + fast moving robots is a recipe for
disaster.]

Then they can satisfy both the "I want to see it before I buy it" crowd as
well as the "I know what I want - just give me the best price" crowd.

Mark my words. Amazon has the Costco's, Walmart's and Best Buy's of the world
squarely in their crosshairs.

*Of course there will of course always be specialty categories that are too niche to fit in this model, thus many specialized retailers will still exist.

~~~
rdl
Interesting idea, but I seriously doubt Amazon would do this with their normal
warehouses -- maybe paying sales tax and thus being able to have presence in
major cities would let them set up dedicated showrooms for certain kinds of
high-lifetime-margin products, like Kindles and maybe a Kindle Phone, though.

Big warehouses are highly automated (especially Amazon's), essentially unsafe
for untrained people (forklifts, robots), and potentially at risk for theft.
Not the kind of place you'd want customers milling around. Amazon is more
likely to promote their existing easy return policy -- buy 3 pairs of shoes
and send back the two you don't like -- vs. letting people into their
warehouses.

Small, Apple-store style showrooms, or partnerships with someplace like
Starbucks, would make a lot more sense. The lifetime value of a Kindle user
far exceeds the cost of a Kindle (I probably have 200 x $10 books on mine at
least), and it's the kind of product where try before you buy could be
important. I'd rather have a bunch of Kindles and Kindle Fires in a cafe
setting where you could check one out for a few hours, buy or get free drinks,
and comfortably use the devices in an ideal environment, though. This could
work for all the Amazon first-party products.

Maybe there are third-party products which would benefit from this, so Apple
store sized showrooms with rotating third party stock (and fixed first party
stock) could work, but they are really unlikely to be the existing warehouses.

~~~
Goronmon
If Amazon can deliver in one-day, why even worry about stock at these
showrooms. Find something you like, order it, and it's delivered to your door
the next day.

~~~
rdl
Certain huge items are obnoxious to purchase, evaluate, and then return if
unsatisfied -- like 80" LCD TVs. Not sure what percentage of Amazon that is.

Also, many people feel "bad" about buying and returning. The "buy 3 pair of
shoes, return 2" where you know you'll only keep 1 from the start feels
dishonest in a way, although I'm more than happy to return something which
isn't as described or is otherwise unpredictably unsatisfying.

I actually do a mental calculation before buying something which I might
return, trying to figure out if Amazon is better off by me buying it (given my
odds of returning it, and the costs/residual resale value if returned), and if
the return is due to a bad description (Amazon's fault, and thus ok to return
if the product turns out to match the wrong part of the description, like when
it is internally inconsistent with the photo or whatever).

"Which of these two should I buy" is sometimes addressed by buying both, but
buying 10 items and returning 9 is probably going to get your Amazon account
flagged at some point.

------
api
More technology driven hyper-deflation on the way.

The future: high inflation in food, energy, fuel, and consumables, hyper-
deflation in everything else except to the extent that it depends on or
consumes the former.

~~~
GFKjunior
Solid analysis, the only other online community I frequent is zerohedge and
they have been calling it biflation for some time now.

Things like housing, equity, and bond prices will deflate while commodity
prices will continue to inflate.

~~~
Codhisattva
The act of predicting the future alters the future. Especially true with
economics.

------
JoeCortopassi
Isn't this just one step away from Amazon just being another brick-and-mortar?
If this is the case, is not having an actual store that is accessible by
customers (and coincidentally, the neccessary staff), _that much_ of a
operational advantage?

Or is this just a case of the more efficient company (Amazon) beating out less
efficient companies (Best Buy, Barnes and Nobles, etc...)?

~~~
jdminhbg
It's not just the staff, I think -- it's the real estate. Amazon doesn't have
to have conveniently located distributed locations and the inventory headaches
associated with them; they can just have one gigantic warehouse in Jersey that
provides goods to all their customers in Manhattan.

------
peppertree
Amazon is playing chess while the brick and mortar stores are playing
checkers.

~~~
enraged_camel
Can you elaborate?

~~~
jmonegro
Amazon is playing a complicated but more rewarding game with millions of moves
and therefore ample opportunities to innovate, while old fashioned brick and
mortar stores are stuck in a simple game with little to no room for more
innovation.

~~~
kamaal
I think the small stores have had their chance, which has come and gone.

Simple rule while you do anything it to ponder the 'next steps'. You just
can't keep waiting and expect your competition to do nothing in return.

------
dr_
"I have no idea how Amazon made any money on my order (the whole bill was less
than $30) but several people on Twitter told me that they’ve experienced
similarly delightful service."

Therein lies the problem. At some point there will have to be revenues to
justify the company's valuation. I suppose their goal is to initially
obliterate all competition in entirety and then have everyone purchase from
Amazon. I'm doubtful this will work. Of late, there has been a trend towards
experience stores - with manufacturers creating their own stores instead of
distributing to retailers. Many luxury brands do this and even some non-luxe
ones, such as Samsonite, have been getting into the game. There's some value
added here, and it's something Amazon won't be able to directly compete with.

~~~
notatoad
I think you might be underestimating amazon's position. They already have
massive revenues, and better mindshare than most of the brands they sell. They
aren't some new startup, they bring in millions of dollars a day and are
historically proven to be a successful company. Your post would make sense if
amazon were a year old. They aren't. They've been doing this for a long time
now and are very very good at it.

~~~
sureshv
Q1 2012 Amazon had $13B in revenue and basically broke even, Costco had $23B
in revenue, and Walmart has $113B. Where are you getting your financials from?

~~~
jrabone
And Amazon's revenue is growing 33% YoY. Costco is 8%. Wallmart is 8.5%. See
where this is going?

~~~
sureshv
While making very little profit; that's not infinitely sustainable in retail
where margins approach nothing. Amazon 2012 profit was $650M, Costco $1.4B,
and Walmart $16B. If Walmart decided to go zero profit they could drive out a
lot of competition and get a visit from the DOJ...

~~~
ippisl
Amazon has a great story to tell the DOJ:we've not reduced our prices, we're
working on offering better service: prime service is expensive, and we're
building costly warehouses and bought a robotics company, and investing in
pack-stasions.

------
ktr
This is crazy - I ordered 3 things from Amazon today through Prime and started
wondering if/when a day would come when you'd have same day delivery from
Amazon and what it would look like. I figured it would happen someday, but
thought the complexities would be too much to handle for a while. Looks like
they're way ahead of me. This is why I _love_ Amazon.

~~~
Gustomaximus
I think this will come into it's own with driverless car technology. Once we
combine the current automated warehouses with automated delivery the timescale
and costs will drop dramatically.

~~~
sage_joch
I think the implications of emerging technologies are greater than most people
realize. Between driverless cars, voice-recognition systems, and the Internet,
it doesn't seem far-fetched to imagine saying, "Computer: deliver one large
pepperoni pizza and a Sprite", and having it appear on your doorstep within 15
minutes. All without human intervention.

~~~
Gustomaximus
And then we have 3D printing. This is one tech that IMO is going to come fast
as companies continue advancing this tech. And then we can swap delivery time
for print time on basic items!

------
bennesvig
The only advantage local retail stores have is immediacy. You can buy it as
fast as you can drive there (and park/find it in the store/wait in line).
Amazon has almost every other advantage. Ive come to find shopping local
retail stores more and more frustrating. Shopping without reviews or videos,
and having to flag down employees to help you locate items. It's really hard
to beat online shopping with one day or two day shipping. Not impossible, but
challenging. Target, Best Buy, and other generic mass retailers would be hurt
the most

~~~
ekianjo
Yeah, but most of the time your local retailers will not have the right
product in stock (unless you are very vague about your requirements).

On top of that, local stores are annoying: it takes time to go there, you need
to deal with traffic, weather condition, sometimes shop employees being too
intrusive and wanting to see you additional services (or recommending you bad
products), waiting in line just to pay. etc... It's just not worth anymore.

Amazon delivers at my door usually 2 days after I order something. In case of
defect they even come at my door to pick the malfunctioning product.

They are clearly doing what's BEST for customers. I don't even understand why
local shops who have stores a few kms away from me don't even offer delivery
services. They don't even think about improving anything, and they well
deserve to disappear. No regrets.

------
stretchwithme
Because the last mile is always so expensive and subject to theft, I think
we'll eventually have a centralized local pickup location for all sorts of
small deliveries. We'll just stop there on the way home if something has
arrived.

That will even include your postal mail if the postal service ever wakes up.
There's no need to physically deliver mail every day if people could see what
mail they've received remotely and can pick it up or request deliver if they
can't leave home.

~~~
ianb
We've built a little nook for packages on our front porch, I wonder if more
people will do that sort of thing as well.

~~~
stretchwithme
In the old days, they had milk boxes. One house I lived in as a kid had one.
There's usually a door on the outside and a locked door on the inside. Here's
one:

[http://www.wellsphere.com/allergies-article/built-in-milk-
bo...](http://www.wellsphere.com/allergies-article/built-in-milk-box/1077155)

------
S201
Looks like Amazon is finally bringing Webvan to fruition. Only took 11 years.

~~~
cjensen
By building many warehouses before proving the idea works, they appear to also
be repeating Webvan's greatest error.

~~~
alanfalcon
They are offering same day delivery in some markets today, including Las
Vegas. I've used it twice, with the $10 same day delivery being less expensive
than other expedited shipping options. It was very cool having a courier drop
a package at my door with my purchase the same day I bought it. Even with $10
delivery the final price was cheaper than buying from a retail store at retail
prices.

I think with these test markets, Amazon has proven to themselves already that
the idea works. I know that I'm very happy with the results so far!

------
jusben1369
Remember when home videos were going to obliterate movie cinemas? Who would go
out when they can watch a movie on their couch?! For a while too things
dipped. Then people realized there was a social element to going to the movies
that made it a compelling experience. Add to that iMax and 3D etc. Heck, who
would bother going to an Apple store when you can buy everything online!

Amazon is to shopping what McDonalds is to food. We all know what happens when
you have McDonalds every day.

~~~
ricardobeat
You get fat?

I rarely go to the movies because I can watch netflix on my couch (and save
$20-$30). Movie attendance still grows because of economic growth, but in
relative numbers it's falling (down 4% in the US/2011).

~~~
gwern
And there are other factors; 3D movies apparently have contributed to profits.

------
dkrich
"I’d gotten next-day Saturday service for free. I have no idea how Amazon made
any money on my order (the whole bill was less than $30) but several people on
Twitter told me that they’ve experienced similarly delightful service."

I've got news for you- they didn't make any money on your order. Amazon is
profitable but has razor-thin margins on the whole. They take losses on
several markets, including Prime, gambling that the entire seamless, low-cost
user experience will cause enough people to spend enough money to push them
over the edge of profitability.

I for one have serious doubts about whether what the author describes (based
to a large extent on pure speculation) would be a profitable business model.
It's one thing to keep huge amounts of inventory in centralized locations and
ship items out across the country over the course of days. It's quite another
to stock all that inventory redundantly throughout every state. So if I want
to buy a specific pair of shoes that I can't find at Foot Locker, is Amazon
going to stock 50 pairs on the off-chance that somebody down the street is
going to buy them? Probably not.

In fact, the USPS runs a similar business model. One would then logically
think (if this article is any indicator) that UPS and FedEx would go belly-up.
I mean after all, if I can distribute mail to somebody's house for $0.50 in a
day, how could UPS and FedEx compete with that? The reality is just the
opposite. UPS and FedEx enjoy such enormous margins when compared to the USPS,
that they want no part of the markets in which the USPS operates and it's too
late for the USPS to compete with UPS and FedEx on parcels and important
packages. I don't agree with the author's prediction at all.

------
ori_b
When Amazon lets me physically try out the feel of things while browsing them,
see how well built a tool is, or how a piece of clothing fits, it might have a
chance of killing local retail.

Until then, I like to see which pants fit best, which knife is most
comfortable in my hand, which tablet is most responsive. Yes, if I already
know what I want, I'll go to Amazon. But if I'm not entirely sure and I want
to compare things, I'll go to a local store.

------
sageikosa
At long last, the dreams of the Coyote ordering from Acme and getting
immediate delivery of his latest gadget to catch the Roadrunner come closer to
fruition.

------
k-mcgrady
I don't think it will destroy local retail. All the businesses within a 10
minute walk of your home will be fine, it's still more convenient than same
day shipping unless your very busy. It's the businesses slightly outside the
core of the town that will suffer. If it takes you 30-60 minutes to drive to a
store you might order same-day from Amazon.

------
hef19898
The biggest challenge I see for amazon to come is, besides competition and
makets and all that their ability to handle their whole supply chain. Amazon
already proved that in terms of warehousing and distribution they are really
ggod. but if there is one thing that comes with an ever increasing number of
arehouses, especially if you want same-day delivery, is a ever increasing
inventory level, in both number of items and value.

So from the outside one cornerstone of a strategy like this would be inventory
management at at least regional if not even warehouse level. It's do-able, no
question, but difficult. An advantage amazon has here is a huge history of
point-of-sales data for most important regions they are operating in, no
matter if there actualy is a amzon warehouse or not. And if they don't have
(enough) point of sales data, well then it's to early to offer same-day
service and all that.

All amazon has to do now is to keep operations up to the task... :-)

------
damian2000
Here's the original Financial Times article that this one was mostly taken
from (nb: this link avoids their paywall via google's url redirection):

[http://www.google.com/url?q=http://www.ft.com/intl/cms/s/0/9...](http://www.google.com/url?q=http://www.ft.com/intl/cms/s/0/9bde8748-c201-11e1-8e7c-00144feabdc0.html)

~~~
farhadmanjoo
It's not "mostly taken from." Read both articles.

------
learc83
The other day I ordered something from Amazon, and it showed up in a small
cargo van, delivered by a guy without a uniform, and in a package with no UPS
or FEDEX label (or any other delivery label I could discern apart from the
amazon labels).

Was this some kind of test for Amazon ran delivery from a local warehouse?

~~~
tomfakes
The package I had delivered today came via Amazon Fresh - the grocery delivery
service they are testing in the Seattle area. It looks like they're also using
it for non-Fresh items too for small, commodity items like CDs

This is Amazon owning the entire process from order until the item is in my
hand.

~~~
MartinCron
I use Amazon fresh all the time, and it's possible to get all sorts of non-
grocery things through it. I think it's whatever Amazon.com stuff they have
available in the local warehouse.

------
zeroonetwothree
Workplaces should be an easy place to get same day delivery. At a large office
you probably have 100+ Amazon orders each day that conveniently get delivered
by the company's staff. Amazon could have their own truck just drive straight
to the office building without getting UPS involved at all.

------
ilaksh
OK so pretty soon Amazon will have same day delivery. That's going to be
great!

Then, can we have evacuated tubes that connect our homes to all of the retail
outlets, or homes to homes maybe also, and then they could have like 5 minute
delivery, or however long it takes the picking robot to get it and then for it
to travel at hypersonic speed through the tube?

Maybe we should all live within a few hundred yards of the warehouses. Then
upgrade the picking robots and streamline the warehouses and tubes so they can
deliver items in less than a minute.

Then we can all have robots that pull the items out of the tube, open the
packaging and hand it to us on our couches/beds.

I would totally buy a giant plastic jug of cheeseballs right now if it could
arrive in less than a minute and be delivered to my hands.

------
tmuir
In the chicago area, you can order from McMaster Carr (mechanical hardware),
and get same day delivery. Any company that builds anything mechanical is
probably ordering something from McMaster Carr. This isn't an impossible
problem.

------
mseebach
> Physical retailers have long argued that once Amazon plays fairly on taxes,
> the company wouldn’t look like such a great deal to most consumers.

I love the audacity of "If you can't beat them, find some other way to beat
them."

------
jonhendry
Local retail is their own worst enemy, at least those that have websites.

If I go to the website of a brick and mortar store, chances are I want to know
what they carry in-store, because I need something specific and am planning to
visit a store.

Ideally I'd be able to see what they have in stock at the local stores, so I
can avoid a needless trip.

Instead, many retailers have larded up their online stores with online-only
products. Some don't even give you an easy way to exclude those and see only
in-store items.

This is stupid, and just makes me more likely to not bother visiting the store
at all, opting to just order from Amazon.

------
webjunkie
In Germany, when you order in the morning before noon, you will most likely
get your stuff by the next morning without any special shipping at all. That's
how efficient the German postal service is :)

------
Scene_Cast2
There are a few fundamental, hard problems : energy and transportation. Amazon
is trying to solve a subset of the latter here. However, I like to see/feel
some things in person before buying. I often go through lot of items before
finding "the one". Examples: food, pens, shoes. It would revolutionize the
industry if Amazon could solve that. Until then, it's just a really large
online store. Also - USA isn't the world. Non-US Amazon is heavily sub-par to
other online stores: worse prices, small selection. So there's that, too.

~~~
ippisl
I think amazon is concentrating on the clear and really hard pieces of
eCommerce: warehouses everywhere, robotics, pack stations and leaves the fuzzy
and less hard pieces to start-ups.

So now for example there are many start-ups working on the clothes and shoes
fitting problem. In the future when the solution will be found , amazon would
buy them , or just use their eCommerce muscle to force them into good terms or
just copy them if possible.

~~~
GFischer
Do you have some examples of startups working on the clothes and shoes fitting
problem? (I have an idea about that, which I hope to turn into an MVP)

~~~
ippisl
Fits.me, Styku, Zugarz, shoefitr,true fit,fitiquete,Quincy Apparel, fitted
fashion.

~~~
GFischer
Thank you :)

------
hrktb
I'd have died to have that in the US or Japan for e.g., anywhere delivery of
basic goods actually works and isn't painful. I feel the main barrier to this
is to have the local delivery company deliver things on time and in a friendly
fashion.

That's not something you could expect in any country amazon operates (french's
chronopost delivery is really hostile for ex., but there should be a ton of
others). It'd bear with it for things I expect in weeks anyway, it would be
horrible to have it for goods that are supposed to be there today.

------
grandalf
I already don't shop locally except on a whim and when there are items I'm not
price sensitive about at all. Well, groceries are an exception but I like to
pick my own produce.

------
baak
To be honest, I feel this has a good outcome for environmentalism as well.
Same day delivery putting physical retailers out of business means less
overall driving.

------
stephen272
First the internet revolutionized music and eliminated record stores Then it
revolutionized videos and took down video stores It didn't stop there, and
moved on to bookstores and wiped them out. And now its taking out brick and
mortar stores in general. Honestly, I LOVE IT! The internet is so great.
Anything that gets stuff in my hand faster or easier is great in my eyes.

------
ams6110
I don't see how they can possibly achieve the same economies of scale with a
lot of small local distribution centers vs. a few huge ones. Plus coordinating
deliveries in all those local markets vs. just having UPS or FedEx handle that
part. To a point this may be successful, but it sounds self-limiting to me.

------
dave5104
I'm surprised Amazon just hasn't started their own logistics company. With the
spread of their warehouses now, is the next logical step becoming their own
USPS/UPS/FedEx? I can only imagine what would happen once Amazon takes over
the part of the process that seems to always have the most problems.

~~~
rdl
Until now it would have meant becoming a business in each delivery state and
thus exposing themselves to sales tax. Maybe this will change in the future,
and they are their own delivery company for AmazonFresh in Seattle I think.

------
Shivetya
I remember my grandmother telling us how first the bus and then the family car
let her shop where she wanted to. Stores adapted. Face it, lack of
transportation will allow bad service to exist simply because the customers
are trapped.

When your the only game in town, well.

So I don't buy the dire predictions.

------
parka
I hope this applies to international shipping as well.

I buy stuff regularly from Amazon and their prices are even cheaper than what
my country's local stores are offering after shipping included. E.g. A book
from Amazon cost ~30% cheaper than the shops here in Singapore.

------
russell
I actually have a problem with Amazon's shipping. I live in a small town.
Often FedEx shipments are dropped off at the USPS, so a two day delivery turns
into three or more days. The worst was 5 days. UPS OTOH often delivers the
next day.

------
arjn
My opinion is that this may not be the end of local retail. I would still
prefer to shop at my local grocers and farmers market on the weekend.
Sometimes shopping is more than just shopping, its also an outing with family.

~~~
greedo
What percentage does this comprise of your annual purchases?

~~~
arjn
Roughly : local grocers ~75-80%, farmers market ~10% , big superstores ~10-15%
.

------
emperorcezar
A business is required to pay sales tax, not collect. Like some other
businesses, Amazon can just include the tax in the price.

For instance, bars will include the taxes in the drink tax because if they
show you how much tax is in a glass of beer you'd be very surprised, it's
something like 40%.

It's an mental game though. Do you get people "through the door" with an item
at $19.99 and hope they don't close the tab when they see the $1.00 tax, or do
you just advertise it at $21.99 and hope that people are attracted to you
because of name, etc even though joesonlineshop.com has it for $19.99?

~~~
mh-
not really accurate.

Businesses don't pay sales tax on purchases for resale. Sales tax is paid by
the consumer, but _collected_ by the business.

In most states, there is an exception afforded to food/liquor businesses that
allows them to advertise prices tax-included.

Otherwise, the state laws usually look like this one:
[http://dor.wa.gov/Content/GetAFormOrPublication/PublicationB...](http://dor.wa.gov/Content/GetAFormOrPublication/PublicationBySubject/TaxTopics/TaxIncluded.aspx)

~~~
emperorcezar
Sadly the link is broken.

I remember when I did a small computer repair business out east 10 years ago
that this was not the case.

------
zackmorris
I thought of this November 3, 2010 :-)

<http://beginwithyou.org/2010/11/03/the-next-ebay/>

------
wilki
I do wonder how much online retailers have saved by not dealing with
shoplifting and the overhead involved with a fleet of loss-prevention
employees.

~~~
ams6110
I'm quite sure any warehouse operator will tell you that there is still a
problem with theft.

------
kfury
TL;DR: "Amazon's going to wreck retail now that they're giving up their unfair
advantage and relying solely on better service."

Boo hoo.

------
sanjiallblue
Once 3D printing tech gets off the ground, same-day delivery could end up
becoming common or even the standard.

------
mariuolo
I can think of several local stores I would like to be erased from existence.

------
snambi
Amazon is trying to become a specialized shipping service?

------
andyl
Retailers pushed to impose the sales tax on Amazon. Now it looks like they are
going to get what they asked for.

------
jsavimbi
I don't shop local any more unless it's for a premium item and the customer
service is beyond average. Not when Amazon can deliver consumer items the next
day.

------
adventureful
I thought Walmart already destroyed traditional local retail?

This one goes in the scaremonger bag.

------
ck2
What this is going to do is punish people in non-metro areas.

The way that happens is the same way supermarkets work. In very competitive
areas, cut rate prices, coupons and promos like doubling, etc. are offered
very liberally. To make up for that profit loss, they pump up the prices and
cut out promotions in areas where there is little to no competition.

In areas with a walmart and target and now amazon local delivery, prices are
going to be crazy good.

Everyone else will suffer as they supplement the profit-loss.

~~~
einhverfr
I don't know about that. In Chelan, WA (population 3000, plus tourists, whole
valley population maybe 10000 + tourists) 2 supermarkets, 3 if you count the
fact that one of them has another location the next town over), prices aren't
any higher than they are in Seattle, and both supermarkets have _amazing_
deals occasionally.

I once bought a whole beef tenderloin for $5.99/lb during one of the specials.
One supermarket has themed specials every 2-3 weeks during the summer and
reasonable prices the rest of the time. They also really focus on meeting
needs of everyone around, so you can find goat meat, intestines, tripe, cow
feet, and shank for sale in their meat department, and the shank is about half
the price that they originally quoted me when i requested it.

The fact is that if you are in a rural area, you already end up with lower
housing prices and some other benefits. So I wouldn't be surprised if that
compensates for the increased shipping efforts.

I am not saying I like the supermarkets. I wont do business with the local
Safeway because of ways they have treated family members. However, I wouldn't
say prices are higher.

------
craze3
_(Disclosure: Slate participates in Amazon Associates, an "affiliate"
advertising plan that rewards websites for sending customers to the online
store. This means that if you click on an Amazon link from Slate—including a
link in this story—and you end up buying something, Amazon will send Slate a
percentage of your final purchase price.)_

Do they really think that they'll get more affiliate conversions by being the
honest guys? Seriously, what is the point of this?

~~~
suresk
It looks like they are just trying to disclose a potential conflict of
interest.

