Anyway, this has been a tough business all the way back to Webvan!
I'm going to sound like a huge snob, but it makes the in-store shopping experience much less pleasant. The actual whole food workers are always there for you and go out of their way to help you, I don't expect the online shopper order fillers to help me, but they at best DGAF about the in-store shoppers and at worst are hostile towards them.
They speed past people and around corners with carts, cut in line at the fruits and veggies, ask WF employees to help them find items while you've waited to talk to them and in return, flat out ignore actual in-store shoppers when they ask for help. If you're out of the tech loop and don't realize that they are incentivized to fill orders, you might think the online shopper fillers are part of the WF staff there to help you. Knowing this, it's not too jarring to me to see a customer go up to one of them and have their many 'excuse me's just ignored, not even acknowledged.
They need shirts that say don't ask me for help; I know the way they are incentivized to fill as many orders is what creates this behavior - that needs to be looked at as well in my opinion.
Resistance to it doesn't have to be snobbish either. The entire grocery business model today is designed for people shopping for themselves. Stores occupy the largest and most expensive retail spaces in the center of the neighborhood. There are wide aisles, fancy decor and complex layouts to showcase products and keep people inside. I love going to the grocery store without a list or any agenda and coming out with a new interesting dinner option, buying loaves of bread on impulse because they just came out of the oven and smell great, talking to the butcher about fresh cuts of meat, getting a recommendation for a new wine or cheese to try out. Like myself I imagine grocery shopping is as much a hobby as bare necessity for others as well.
If delivery becomes a norm then none of this will exist anymore (at least at an affordable price). Grocery stores will just be large warehouses outside the city optimized for serving pre-decided orders as quickly and efficiently as possible.
A consumer grocery shopper wants like with like (including in multiple locations. e.g. I want chili powder in the spice aisle, and with the mexican food), lots of variety, things organized by price. etc...
A food order picker wants something that looks like an ikea warehouse. Pick items x,y,z from bins a,b,c in aisle 3. They could probably care less if like is with like, as long as there is an easy way to find substitutes. They want to work with a bunch of people that are 'on a mission' like they are. And not have to deal with people like me who read the marketing copy on each type of Newman's pasta sauce.
Picking in store has a huge number of cost base efficiencies compared to using a 'dark store'. These are as follows:
* Reduced property costs and property overhead.
* Having 5 vans in 300 locations is better than having 300 vans in 5 locations from a transport perspective (you get much closer to the customer, or have to tranship through hubs).
* Depending on locale, store workers may have more relaxed terms and conditions and unionisation than industrial warehouse workers, which 'warehouse' workers may get dependent on setup.
* Every darkstore you have needs to be fully stocked. This isn't so much of an issue with long-life products, but is an issue with fresh products that need to be sold before their expiry. A darkstore has a 'minimum viable size' with these fresh products dependent on the range you want to offer. Bigger darkstore with more customers means a bigger range - but you are also further away from the customer so either you have a bigger stem distance or need to do trunking to hubs and tranship from there.
So it's not about getting wise, trust me we think about these things and will model what is the most optimum way to deliver, at least in the UK :) An incredibly rough rule-of-thumb of logistics in the UK is that 1/3 of your money is spent on transport, 1/3 is spent on warehouse labour and 1/3 is spent on fixed costs (building, rent, utilities, equipment) - so your saving on labour has to be significant to pull back the fixed cost benefit of running out of an existing retail estate.
This is in the UK - most supermarkets have their own in-store pickers and will deliver with vans in the back. We have one company (Occado) that has a few large DC's and will tranship to outbases with vans. Some supermarkets have these dedicated 'darkstore' facilities in super-dense areas (e.g. Tesco, Asda), but they don't work in most areas of the country and in most cases are actually more expensive to run than in-store picking operations (they are done for capacity reasons rather than cost reasons).
The advantages of the centralised approach tend actually to be about service. If I can centralise to a big enough warehouse, I can offer a better range and offer things like visibility of expiry dates.
I guess the current model where couriers shop at the retail store is a result of hacking up an MVP. It’s very inefficient at scale. Once the grocery stores and retailers deeply integrate with the delivery companies a more efficient workflow will emerge. Something closer to what you just described.
I wonder if they could have that staging area in the back (warehouse or what ever it is called), which wouldn't directly impact the in-store shoppers.
- Four bunches of ~7 bananas instead of 4 individual bananas
- A single cherry tomato instead of one pound of cherry tomatoes
- Candied walnuts substituted for fajita seasoning
I'm not overly upset about it, but the main problem is definitely the quantity issue-- several different drivers have purchased absurd quantities that seem like something one would obviously question and double-check. Or that something would be flagged when the price is so far outside the expected price on the app. I would think this would be totally solved by store-provided shoppers though.
You'd think this business would be going through the roof during the pandemic. If it can't work now, how is it ever going to work?
In other words, conditions in which the pool of labor is less heinously and obviously exploited and better workers are easier to recruit for the job in question.
In other words, if all of a sudden insta-cart was much more generous with their employees and managed to hire better talent, that wouldn't likely translate into more demand for their product. Yes places like Trader Joes treat their workers well (and build brand around that) - the lions share of demand revolves around on merits/price. I wish it was more along your factor but sense that it isn't a factor with an order of magnitude change associated with it.
Delivery is $5, with the same $4.95 same or next day surcharge as pickup. It is a great deal.
I guess Instacart was a trailblazer? I don't see why supermarkets wouldn't offer this service and pocket the difference.
In the UK major food supermarket do deliveries or local collection.
They're prepared by the supermarket staff in their warehouse, without having to browse the supermarket.
They're quite reliable (you order online and you have to pick the products manually) but they will apply substitutions sometimes.
Collection is free if you order over a certain amount.
Covid messed up things (queues got super long / expensive) but overall it's a well working model.
Costco is probably the more 'reasonable' one. They mark up the products probably 5-10%. So this one I feel that the delivery people are probably being paid ok.. although my nearest costco is 16 miles away (about 25min).. so it kind of feels like a steal to be able to get delivery from them for what feels like not a whole lot more.
Walmart is closer, but there are no markups.. and I pay whatever $10/mo for free delivery from them. Order multiple times a month.
I'm honestly not sure I'm going to go back to the stores as often even when things are normal.
Are you really? What have you tried to modify this as a result?
Many gig workers have their tips taken away or obscured in some cases, as in the lawsuit settled by Doodash recently, which is most of their total income from these things: the algo sets the base salary as close as the lower minima for it to get picked up.
Have you ever considered just paying them more outright: as in leave an envelope at your door with the sum of money you think they're worth? Or simply asking them to contact you directly to be their personal shoppers if things were done to your satisfaction? I saw the former more often, with token sums like $5/10 by some well intentioned people but really the latter would be the more impactful solution and had been done prior to this for the affluent/exec class long ago.
Just so it's clear, the markup on those apps isn't going to the contractor's pay, its their to generate revenue for the core business to pump its valuation with fluff and prove its MVP has the potential to reach profitability... someday in the undetermined future. The gig worker gets as little as the market will bare most times, the app is optimized that way, and often has to be 'stacked' to make it even worth their time or will remain bouncing around in the limbo if no one picks it up.
I spent a lot of time looking at Doordash's business model during the pandemic while I went back to school or supply chain management after having done supply chain and logistics in the Auto Industry. I even did it myself to understand it's implications as a 3PL supply chain solution ahead of its IPO last year and it was super eye opening.
These things are horrible and are specifically targeted to the ever growing under underclass of Society. I'd say its borderline predatory given how much they gameify it in their favour.
> I'm honestly not sure I'm going to go back to the stores as often even when things are normal.
And quite frankly these apps/platforms are relying on you doing exactly that to justify its business model and will operate at a loss to do so in order for a massive IPO valuation and more VC money.
It's really quite sick, but it seems almost inevitable at this point given how many businesses have been shut down during this pandemic.
If I had the time and resources I would really want to do a talk at the Chaos Computer Club on it, as I think it really needs to be exposed for what it is amongst the Technorati who help built this monstrosity. I saw a Software guy who wanted to get the analytics on rejected offers from various regions with an app that tracked the acceptance ratios and other metrics, so the data exists out there somewhere.
Just have warehouses/stores optimized for delivery and batch the orders. Boost productivity and start paying people decent already.
There are. FreshDirect has a state-of-the-art facility in the Bronx, and I'm sure Amazon has several ghost groceries also -- e.g. they just bought two Fairways locations.
Check out this video of the FreshDirect facility, it's actually pretty amazing: https://www.youtube.com/watch?v=fnIrwrCq_4Q
Instacart and the local grocery store should be able to work together to make incremental changes to what they are doing today. That seems like the low hanging fruit that could be put into operation in short order.
Also, back then the technology for sub-minimum-wage delivery gig workers hadn't been perfected yet.
I put in an order later in the day, and half the stuff I ordered was unavailable because the store shelves weren't being restocked before closing. I was stunned. I had naively assumed that the food was coming from an Amazon-like warehouse, where they knew exactly what was in stock prior to ordering. A pretty terrible experience overall.
I expect Amazon will at some point leverage Whole Foods to build a proper food warehouse with the experience we've come to expect from Amazon Prime. The big supermarket chains better get their act together quick, before Amazon eats their lunch.
They do this depending on your metro/area. Here in SF-proper (dogpatch) there is a brick and mortar Whole Foods ~0.7 miles away, but my Whole Foods online orders get packaged from a nearby Amazon Warehouse even closer to my residence.
The experience has been very good for me so far and I have no need for an Instacart-like service.
For groceries you have the additional challenge that different items need to be stored differently (cooled, frozen) during the time between getting retrieved from the big warehouse and being sent on their last mile.
You can build something for this, of course, but that’s expensive. In the case of Amazon, however, they already have facilities for storing smaller amounts of different groceries products that are relatively efficient for sending small amounts of products on their way for last mile delivery: they own supermarkets.
A decade ago I worked on some retail logistics and we ran up against exactly this problem. The solution we came up with was also exactly this: send workers into the nearest supermarket to collect the requested items from there. If you already own the supermarkets and have staff running around there, it’s a no-brainer. In fact, if you look closely you’ll see many retail companies, both large and small, do this.
Rather then supermarket employees running around the shop they build automated warehouses specifically optimised for picking/packing efficiency.
I simply don't see the reason for services like Instacart and Amazon fresh to exist... I can already get deliveries picked and dispatched by the super markets themselves. I count 6 different services within 5 miles of my home/office/isolation bunker.
It's worth noting that off the back of Ocado's success, all major UK supermarkets also offer online delivery. And my understanding is that this is mostly serviced directly from stockrooms rather than going via store shelves (albeit individual store stockrooms).
Around the same time Tesco (I can't find exact dates, but when I started working there in 2004 it had already been around for a while) launched their competing service, however they did so across the whole country (at any store big enough and with enough parking space to support it).
Ocado is building a business like Amazon warehouses, where they build warehouses and use their infra to provide fulfilment for other vendors.
If it isn't apparent by now, the people who are still walking around a large store aren't driven by efficiency. They want something to do / enjoy the routine of it, and don't want someone else picking out their stuff for them.
This seems like a clever form of arbitrage, or shall we call it, disruption?
Is this the new frontier (or perhaps I'm just late to the game in understanding it) where larger online businesses (like Amazon) shift away from full time employment (with the costs associated with it) and let some other "local" or "brick and mortar" legacy businesses try to keep those employees with living wages and healthcare employed while those same "frenemies" (purchasing from them, but also competing with them) avoid those costs?
I spoke to an accountant friend the other day who works for a local independent grocery store. They are really trying to keep their low wage workers on payroll, despite having revenues cut in half because of COVID. Everyone is shopping at Amazon+WholeFoods. If those workers lose their jobs, will they be homeless? I don't think consumers care or think about them, even though they might be their neighbors.
Who probably knows a store better: random Instacart shopper or employee of the store?
In the end, Instacart gets faster fulfillment and more accurate fulfillment for a price (whatever cut Kroger etc. take to do this). The stores get direct access to the order data and can then stock their stores better, capture the extra demand, and keep their employees engaged in revenue generating work (Instacart probably pays the store for this service of in-house shopping)
Amazon already outsources like this for last mile deliveries.
Also just generally this makes sense... a Safeway/Shoprite/Whole Foods employee can probably navigate and fill a cart faster than a random shopper who might not be as familiar with every store's layout. For Instacart this is a huge win, faster fulfillment and probably even higher accuracy of fulfilled orders. For chains this is also a great win since they can utilize their employees more, make a little extra off Instacart, and potentially even optimize their store layouts better to cater to this new style of shopping.
Also the headline is quite misleading given that there are only TEN union workers... so "all of its union roles" is misrepresenting the whole thing a bit.
+ $35 tip
I cancelled my Instacart premium membership after that and will not use them again. I just can't justify a $90+ upcharge before tip. IMO Instacart took way too much cut for themselves.
I have been sticking to my local grocery who uses their own in-house shoppers. I miss some of the items I am used to from Costco but at least won't be paying 30%+ premiums.
When times were hard I did instacart and it was a struggle to pay my modest bills even when working 55 hours a week.
With such a small fraction I don't think you can draw conclusions in either direction.
 In other words: these employees would have lost their job regardless of their union status [/edit]
10 unionized employees out of thousands isn't enough critical mass to count as a union for the things that matter. The power is in numbers.
However I then, uh, went on to draw a conclusion anyway in contradiction of my own statement saying we shouldn't draw conclusions because of the sample size. Methinks it's time for more coffee :).
That may be so, but laying off those 10 could be a strategy to kill the union in the crib by keeping the number from ever getting to the thousands. Employees faced with future unionization votes may vote against the union because they're afraid management will find a way to lay them all off if they vote for it, before they're strong enough to resist.
IDK that we can make that assumption. Instacart management has made themselves out to be anti-unionization (a common view by management in the US). If you're an anti-union manager, and you're about to make a massive, 2,000 person layoff declaration, you're going to make sure the unionized group of 10 people is on that list. Can't let that sort of thought spread to other locations, and this serves as a good example to those trying to organize in the future. It's easy to avoid a NLRB loss if you bust the union as part of a larger layoff.
The only thing that would have been telling is if they had announced a huge layoff and NOT taken out the union shop.
It's important to note that "employees", in the US, are entitled to benefits  that "contractors" aren't. As more and more employers try to glorify the gig economy or fire employees in favor of contractors, it is more important than ever to make sure that critical benefits, especially affordable health coverage, are uncoupled from employment status.
0 - https://www.investopedia.com/articles/personal-finance/12091...
* All your work is for one firm
* You use their tools and/or premises to do the work
* You have no realistic opportunity to work some where else - either a restriction in your contract or due to the hours that you work
Then no matter what it says on your contract you are a employee.
That used to be the law in Aotearoa for everybody. But when Peter Jackson turned rouge they changed the law, personally for him and Warner Brothers, to take those rights from people working on films. And computer games.
Treating people as interchangeable parts, like machines, is simply evil.
I think this part would need to be more specific. A while ago I worked as a low level employee at the Gap in Boston, and the rules were that nobody could work more than 29 hours per week so that nobody was categorized as full time, but you also had to be available whenever you were scheduled. However, many people had two jobs, despite this restriction. They would be asking other employees to swap shifts every week and sometimes failing but usually making it work. Nowadays, with Uber, it's a lot easier to fill in an extra 15 hours a week that you'd like to work. So who could really claim to have "no realistic opportunity to work somewhere else" if any odd hours could be filled as an Uber driver or similar gig worker?
It's important to recognize that the different ways of scheduling part time work are really different. 20 hours a week that is mandated with three days notice by your employer really sucks. 20 hours a week that you choose with the Uber app is far better.
I wonder if categorizing contractors v. employees is like recognizing porn. "I know it when I see it" says Justice Stewart.
So if we say, if you employ someone at a normal 40 hour a week job, you have to provide them with benefit X. Then if you pay a contractor 20 hours a week you should have to provide them with something that's half the cost of benefit X. It just sucks to incentivize companies to hire two thousand 20-hour-a-week positions instead of one thousand 40-hour-a-week positions.
This happened in NYC with adjunct professors years ago, according to one of my friends who was working as one. If they wanted to avoid paying benefits they had to reduce the number of hours per semester, and it became uneconomical to keep doing the job for him since the amount of preparation was almost the same but the pay was much reduced.
Sure, it’s heavy handed, but if they are gonna play games we can’t leave things to trust and common sense.
I'm abundantly familiar with the sort of antics that are involved. For another example, my wife used to work in childcare. To cover 8 classrooms Monday to Friday from 7:30 to 5:30 with at least one lead and one aide, plus two floaters (900 hours per week) they employed approximately 36 part-time workers (several were high school/college study programs working 16 or 24 hours per week) and no full-time workers. You're suggesting that they should be mandated to instead hire 24 full-time workers and pay benefits?
In actuality, every teacher and aide except the owners used to be mandated to work no more than 29.5 hours per week. You often had short stints of working from after nap time at 2pm to 5:30pm just so that you could make hours (which sucked when she was driving 30 minutes at 16mpg to make $10.75/hour with gas at $4/gallon). Some people got scheduled mornings, some got afternoons, but you didn't dare come in for a full day because then they'd have to give benefits. It was amazing how paranoid and irate the front office would get at 5:31pm when couple parents were late for pick-up and they had to keep staff around for more than their scheduled hours. If anyone hit more than 30 hours, they'd shuffle the schedule so they were no longer working afternoon shifts that might go long, and this was all complicated by frequently requested shift trades among the underpaid and underemployed people involved; you weren't allowed to cover for anyone if you'd gone over 30 hours in any of the previous 4 weeks. And it was a nightmare for anyone who tried to have a second job that might need you between 7:30 and 5:30, you wouldn't know for sure until Friday night what you'd be asked to work Monday morning. And they weren't just turning screws in a factory, this also had negative effects on the kids they were teaching when they'd wake up from nap time to find a relative stranger watching them.
Given the demographic, they much preferred shuffling around colorful magnets on a calendar to spreadsheets or databases, and there was a lot of shuffling indeed. But I'd hate to imagine what it would be like to code an automated time clock for that byzantine system...it would be generous to call it a game.
I mean if you have first-year "Introduction to Algorithms" as a PT, and another PT "Introduction to NetWorking" then they can easily be taught by a single person. Create an FT where the job is to teach both.
The consequence, as partially intended, is that companies are hesitant to work with individual contractors. The problem is that if you want to start a consultancy, you're going to have a fun time finding your first client.
The correct solution is to decouple employment from taxation/benefits/pension/health-care/everything.
Many people choose to forget that there is such a thing as a part-time employee.
You want 401k match and other nice benefits? Then become a full-time employee somewhere. You like more flexibility and independence, given the trade-offs? Then go with independent contracting.
This is not the case. Companies need permanent staff for:
- deciding strategy, at various levels
- deciding who's worth bringing on board
- managing internal and external staff
- cost (permanent contractors cost a lot)
- being part of corporate memory, which can be handed over in a notice period of a month or two or three, but not in the week it takes for a contractor to offboard
I don't think this is the case for low-supply, high-skill labor (ex: doctors, engineers, etc.) as well as certain low-supply trades (HVAC, welders, etc.) Then bargaining power can properly counteract any such forces.
By money spent, the AMA is the nation’s third largest lobbying organization of the last 20 years, behind only the US Chamber of Commerce and the National Association of Realtors. 
Edit for word choice
There is already excess demand for skilled software engineers and if you don’t like how your company is treating you, there are many others from which to choose.
I’m not opposed to people organizing for whatever purpose they think is best. I am opposed to people being forced to pay a tithe to unions in order to work in their field.
I don’t see unions as making my life in software engineering better at all and, given that, I’m naturally opposed to paying 1% of my earnings to a group that I don’t think will help. If others see it differently, they’re welcome to form one; I’m not “so opposed” that I’ll picket outside their workplace to interfere with them.
Most engineers seeking security for their future would be much better off increasing their 401(k) deferral (or other savings) rate by 1% rather than sending that money to a union.
Steel is out. So are auto workers.
It could be that one of the most prominent of the FAANGs is actually supporting things like this  under the threat of their lower paid warehouse workers unionizing. But also consider that Google is also going after its tech people who were involved in Unionizing and recently investigated an AI ethicsist .
I think its clear, most SWE have it (too?) good with amazing salaries and benefits to placate them into indifference or apathy on the matter and go to great lengths to keep them in an infantile servile cocoon/echo-chamber while at work, all while they create these abominations on privacy, free speech and the Human psyche while much of the rest of the World's working class/Industries suffer with under or unemployment altogether, so why risk it?
Especially since so much of the labour is through H1 visas who can control and dictate the terms of their employment with the simple decision to terminate them and leave them out in the cold rather easily.
It's concerning that even Tesla has been so anti-Union if I'm honest, and speaking as someone who has been in the Auto Industry, mainly German, most of it is highly unionized outside of the US.
It was the Big 3's fault for being complacent and relaxed about innovation that made it non-competitive and was highlighted in 2008 financial crises how bad it had gotten.
I'm not in favour of Unions unless as an absolute last resort, as in the case with FAANGs devouring of the Market share and its consolidation of the competition. I personally think having Unions only made the situation in 2008 worse for the Big 3 due to wide spread corruption and incompetence from the executive board, design, and engineering departments: but the core of the problem with US car manufacturers is with having a mediocre product in comparison to the rest of the World, rather than it solely being a union based Industry and thus a sure failure.
That much is clear and had been the case outside of pick up trucks since the 70s as Japan, Germany and now Korea have eaten the US' lunch (marketshare) in total national and international deliveries/sales YoY and DoD.
In the end it didn't stop Ford from still offering union based jobs, declining a bailout and they simply deciding to stop making cars now and focused on their stronger selling trucks, SUV products and some EV stuff, some of which is still in the works. They also had a massive marketing push for their Mustang and GT line up in Motorsports that made it rather successful. Though I think GM had more success with its relaunch of the Charger.
I wouldn't buy any of it myself, but I commend their efforts and still it shows that the 'Unions are the source of all evil' that many Tech based conglomerates push is not true, especially for Mega Corps like Amazon and Google who have severe and outright horrible labour problems.
While I do appreciate that from their perspective it makes sense, it is also true that if we don't fight to protect workers, all jobs will go this way. That's actually why what an up-thread comment said is a great idea. If we decouple important things like healthcare from employment, then everyone gets important quality of life care without employers having to restrict benefits. If we do not fight for ourselves, we will end up in a situation where most people cannot access the basic necessities of life. Already in the US millions of Americans are without healthcare.
Doctors, I know, have powerful unions and associations. Very, very, powerful.
Now, whether things like healthcare and retirement should be linked to employment in the first place, is a real and valid question. But currently it is, and the distinction between "employee" and "contractor" seems bogus in a lot of cases.
I'm in the US and generally my employment has been at will, either of us are free to end the arrangement at any time. Having a specific date where that arrangement ends doesn't seem to be more flexible, if I wanted to leave in a month I would just give my notice and leave.
I'm in the same position as you career wise and I often get offers to join contract roles and they are very unappealing to me. When I do the math on the benefits I'd lose out on and the additional taxes, rarely are these offers competitive let alone when I factor in the greater volatility inherent in the arrangement and the lack of unemployment benefits. Also in my experience the recruiters pushing the contract roles are the most desperate and aggressive, that doesn't lead me to believe these roles are all that high quality.
The contract is for a year, with the option to extend. The job I just left was salaried but actively laying people off. So while both positions have risk, the contracted one provides a much higher income and flexibility to use it as I see fit. Plus any work I do on the weekend for the contract position is paid, as a salaried employee its not.
What if you had to provide your own health insurance?
For example I will use all income in the first half of the year to pay off all of my debt
But, unless your interest is >10%, probably actually costing you money compared to making 4x payments per year. IANAL (or accountant).
If I just quit my job once or twice a year, after being hired as a "permanent" employee, after a while my resume would start to look like a warning sign. Why can't this guy keep a job? But as a contractor, it's normal and expected.
Let's say you were correct. Want to stop it? Regulation is just a wall with holes. The only way to stop it is to reduce the labor force.
If this is actually a plan, it's conception requires that the labor force is going to expand rapidly. In a tighter labor market, companies are much better off locking up labor rather than nickel and diming costs. So any said evil plan is an add-on to opening the gates to immigration, both legal and illegal.
No one really gains as a contractor working 39 hours a week without benefits.
The model of Instacart has evolved, it went from any shopper going into any store and getting you what you need to having the stores actually be in on it and using Instacart as an extension to increase demand and orders (think how DD partners with restaurants for delivery vs. the old Postmates model where they could just send someone in to order your food for you)
I know a woman who worked at my Fortune 500 as a contractor for like 3 years. She was able to bill hourly, work when she wanted (mostly).
I had heard she made $600k for a similar role where if she were an employee she would have gotten $200k + benefits.
The cost of a health plan was negligible.
And yes, this shift was widely predicted by Prop 22's opponents. The only surprise is how fast it's happening.
Looking at Instacart revenue / margin numbers, they hit profitability _for the first time ever_ in April 2020 alongside the COVID pandemic. Further, margins are CRAZY THIN - meaning maintaining profitability is really difficult in an environment of increasing competition from Uber / Google, among others. (Ex: Uber bought Postmates, as the latter had similar margin difficulties.)
My read is that this type of move was planned as an option for Instacart for a while, and Prop 22 maybe pushed up the timeline slightly.
EDIT: not sure why I'm getting downvoted. I know the article tries to build this narrative as much as possible (without even mentioning Prop 22) but then doesn't even provide the financial details that show that Instacart has really tight margins - and if they're trying to IPO, at this rate they're going to stumble there.
> San Francisco-based Instacart and other gig companies including Uber Technologies Inc. and Lyft Inc. last year bankrolled a successful $200 million campaign to pass a California ballot measure exempting them from a state law declaring workers were employees if they did work in the “usual course” of their bosses’ business. Emboldened by that victory, the companies are pushing for similar changes elsewhere that would make it easier to claim workers are contractors.
correlation <> causation, etc. etc.
With that said, wont Instacart, and other similar business models that rely on grocery stores and human labour to fulfill the orders, simply start becoming obsolete in the coming few years as robotic fulfillment centers start popping up all over the place?
Perhaps these centers will not service the most rural of places, but then again I imagine these services (i.e Instacart) are mostly used in more densely populated areas anyway.
Edit: Before you hit that downvote button, can we not have a balanced discussion about pros and cons of Unionization? I am a progressive and a Democrat but I want to know both sides of the coin. For people saying this question is of bad faith, I am not really asking "What are the advantages of murder?" here, Unionization is a complex topic and it would be interesting to understand that it's not just companies exploiting employees, but there is a lot more to it than that.
Since it's next to impossible to get fired from a union shop, lower performers and less ambitious tend to stick around because it's easy work and they can't really get fired. And because pay in union shops is often tied more to tenure than performance, your higher-performing workers tend to get resentful and leave, as they are not rewarded for their contributions.
In terms of inflexibility, markets and conditions can change very quickly, which means people's roles and responsibilities need to change.
Unions tend to (but as a rule to "have to") push back against this, even when the employer is offering re-training programs. Typically unions define what a "job" is and then fight to keep said jobs, which can prevent companies from making the changes they need to. Ironically, this often leads to more, not fewer job losses, since the company can't adapt. This is why many cities in the Northeast still have "typists" officially on their payroll. The union will fight to keep a person's job, _as it was defined the day they were hired_. You can get away with this sort of thing in government, up to a point. In the private sector it can gradually grind companies down, as it prevents them from making the necessary transformations the need to in order to succeed longer term.
Among the criticisms I've heard ...
Sometimes market forces can get you adequate conditions and pay/benefits without the need for collective bargaining. For instance, software engineers tend to be well paid even without needing to unionize. So if you don't feel that you need a union, but you're forced to be in a union (and pay dues) against your will -- as happens in many industries -- you may feel those dues are taking money out of your pocket unnecessarily. In fact, the union leadership might actually be making decisions that benefit them or the members collectively but that don't benefit you individually.
Compensation for the majority of software engineers has not kept up with cost of living increases, inflation nor the amount of revenue they generate for their employers.
Adobe, Apple, Google, Intel, Intuit, Pixar, Lucasfilm and eBay all colluded with one another to keep tech worker compensation below their market rates.
> So if you don't feel that you need a union, but you're forced to be in a union (and pay dues) against your will -- as happens in many industries
No one is forced to work a union job. If your employer makes a decision that you don't like, you aren't forced to work for them, either. If a union makes a decision you don't like, you aren't forced to work for it.
This is technically true, but this is also an argument against unions. It's true that if you don't like that your company is unionized you can go work for a company that's not unionized, but it's also true that if you don't like that your company is not unionized you can go work for a company that is.
I mean, yeah, you owe dues. How else should it work? When I was part of a union it amounted to 2 hours of wages per month, not exactly onerous.
That’s pretty ambitious when the employees are Googlers.
>> When I was part of a union it amounted to 2 hours of wages per month, not exactly onerous.
>> elefanten 2 hours ago [–]
>> Counterexample: the nascent Google employees union is taking 1% of total comp.
Not sure it's really a counterexample as there are - in theory - about 200 work hours per month, so 1% of comp is pretty much equivalent to 2 hours of wages per month.
It's a bigger problem in non Right to Work states, where you can be forced to join the union (and have dues taken from you).
In places where joining the union for their benefits is voluntary I don't see the problem.
There are also places where you don't have to join the union, but they still take some of the wages (at a lower rate than full members) for nebulous "benefits" the union offers. Those are especially contentious because not all the employee believe they get any benefits at all.
The US should shift to the European model where multiple unions are available at each employer, and they compete with each other for membership. I believe joining a union is required there, they don't have any non-union jobs, but a European union is not the same as a US one.
Google: "closed shop vs union shop" and you will see.
Basically you cannot have a business that only hires from a union, but you can have a business that requires you to join a union after being hired meaning the union cannot prevent you from joining them.
Or in other words in non-right-to-work states you can be forced to join a union.
Out of curiosity, what field are your union friends in, and do you happen to know what union represents them?
If it's a "closed" union shop, then I'd consider the union-dues as simply part of the job-offer and treat it the same as employee-side health plan copayments: a minor unpleasantry but nothing worth raising a fuss about - assuming the union dues were in the typical range of $300-800/yr - obviously the more they cost the more I'd be inclined to ensure they're being spent responsibly and that I felt like I was being represented well.
Though I want to say the sentiment (or mental-connotation) you're expressing with language like "against one's will" w.r.t. union membership hints of a reductionist Ayn Randian influence on your opinion. That statement is not an incorrect assessment, but it's overstating the problem - it reminds me of sayings like "taxation is theft".
Sincere question: what do high-quality surveys of union membership (across all industry sectors in the US) suggest about opinions held by closed-shop employees of their unions - and their employers? I feel there's too much reliance online on anecdotes about the excesses of certain named unions when it comes to forming opinions about them, so I'd prefer to see some "big data" about union membership.
I am personally anti-union because inevitably they become so large that they succumb to their own internal forces and become beurocratic and misguided.
While they bring stability and job security to workers who are invested in excellence and quality, they also bring stability and job security to workers who have no desire to be productive. This is demotivational for anyone who needs to work with these employees and has an outsized effect on the organization. To quote a friend, "I love my work, but I can't get anything real done because I need sign-off from X, but he sits around all day, doesn't really work, and no one can fire him."
Democracy ensures some modicum of fairness, but is slow, inefficient, and can lead to very bad outcomes when dealing with highly technical questions. There's probably a place for big, large-scale political questions (who should be president, should we stay in the EU) to be decided by direct democracy, but I wouldn't want that for trade or monetary policy.
The big problem I see with democracy, in general, is that it's highly susceptible to special-interest takeover. When a small group stands to gain disproportionately from a particular outcome, they will lobbby--HARD--to get that outcome. Even when doing so might be so harmful to the overall system, that it collapses, even if they get what they want.
The US analog is the SEIU/AFSCME organizing so hard that the entire government of a state, like Illinois, becomes beholden to what they want.
How did AB5, the TNC bill, pass, when it was overwhelmingly not supported by drivers and the electorate didn't want it, either? Teamsters pushed their agenda. Hard.
Unions will make no bones about running an employer, government, or other organization absolutely into the ground in the name of advocating for their members' interests. They do not care about taxpayers, customers, or any other constituency other than themselves and their members. And when it all falls apart, they'll just go to the next state/company/etc. and run the same playbook, over and over.
It's very harmful. Some things need to be outside the reach of democracy/the masses.
I think people who are really big "repeal citizens united" types need to realize that it cuts both ways.
As someone who spent a lot of time as a member of a once powerful Canadian Union, the downside is that you get what you get, losing individual bargaining ability. You have a vote, but majority rules, and overnight you could be working under terms and conditions you don't necessarily agree with. Promotions and internal transfers are handled by seniority. The collective trumps the individual. Nothing inherently wrong with that, but you can't please everyone.
I made one tenth the salary as professor while teaching as an adjunct in grad school despite having a similar course load. My uncle's union negotiated lay-offs of his division over another one. A lot of us have stories like this that left a bad taste in our mouths about unionization. Corporations can also be guilty of favoritism but they aren't supposed to be on your side of the negotiating table.
- Prioritizing the organization survival or growth over the needs of those who should benefit from it. Ironically, this is the default of for-profit companies.
- People at the top being corrupted, prioritizing personal gain over moral values
- Becoming slow and bureaucratic after becoming big and/or old
Corruption. Over and over again, decade after decade.
Catholic teaching says that in principle, unions can do a lot of good, see for example:
> The most important of all [voluntary associations] are workingmen's unions, for these virtually include all the rest. History attests what excellent results were brought about by the artificers' guilds of olden times. They were the means of affording not only many advantages to the workmen, but in no small degree of promoting the advancement of art, as numerous monuments remain to bear witness...
> Among the basic rights of the human person is to be numbered the right of freely founding unions for working people. These should be able truly to represent them and to contribute to the organizing of economic life in the right way. Included is the right of freely taking part in the activity of these unions without risk of reprisal. Through this orderly participation joined to progressive economic and social formation, all will grow day by day in the awareness of their own function and responsibility, and thus they will be brought to feel that they are comrades in the whole task of economic development and in the attainment of the universal common good according to their capacities and aptitudes.
When I read those descriptions, and compare that to either the limited experience I had working for a company that was largely unionized or the stories that I've heard or read about, I'm not sure how often these apply outside of a few genuinely dangerous occupations.
See as one example how some unions have argued that union jobs should be exempted from minimum wage laws (https://www.theguardian.com/us-news/2016/apr/12/los-angeles-..., https://www.uschamber.com/sites/default/files/documents/file..., https://padailypost.com/2018/04/02/minimum-wage-law-includes...). Evidently, unions see an opportunity to grow their market share by lowering their prices (i.e., wages of labor), and do so by lobbying Congress from exemptions from law, which is the very thing that they claim corporations are evil for doing and that we need unions to exist in order to stop. The argument is that unions are able to negotiate better benefits, but they don't argue for an exemption from minimum wage if the employer provides a certain level of benefits, they argue for an exemption specifically for using unionized labor.
Are there good unions and good union leaders out there? Sure, but I think this example shows that unions in themselves do not advance the "whole task of economic development and in the attainment of the universal common good," but are instead subject to incentives and respond to them the way any other organization does, and very often the incentives of the union leadership is different than those doing the actual work.
some unions have argued that union jobs should be exempted from minimum wage laws
Where people were just
part of a team.
Where your boss didn't
have to be concerned with
which doctor you went to.
Where you could work for $5
an hour for a cause you believed
in, and not have to worry about
making ends meet.
Some day we need to #RefactorAmerica.
But also, hmm, delivery is so hard here.
When someone points to a rising stock market as possible evidence of a strong economy, just keep in mind that the market likes it when a company fires a ton of employees.
Do what helps you make revenue, don't do what doesn't.
I am a fan of one-off utility of people, I think of everything like a commissioned trip to a new continent. Take risk, get the gold, return, distribute payments, disband. Reach out again if there is a similar project.
Keeping people around for no reason is folly and merely trendy.
Not at all. Giving unemployed people useless jobs and paying them for it is great for the economy, and has been successfully used as a form of economic stimulus several times in the past. You are giving money to people who need it the most and will spend it in the local community and keeping them busy/out of trouble at the same time. Plus they have some skills for their resume when the job market improves.
It's a great model for the exploration business (or fields similar to it, such as construction projects, entertainment production and so on). It's not applicable to every single industry though.
I view the Instagram purchase as the most correct example. 30 employees and bought out for 1 billion.
I know so many investors and founders that are shy of certain dollar figures solely because there aren’t like 1000 people involved or some other arbitrary number of employees or personnel. Compared to the most accurate question “can I make a return on this amount of money, and what are those probabilities”.
Obviously there also are founders and investors that do ask the most accurate question, and they grow in number.
It does aggravate me to see this other slower moving culture with irrelevant perceptions of reality based on how many employees a company has. It seems rooted in a prosperity philosophy, where wealth accumulation is granted by compliance with morality, and high employment numbers satisfy that morality. And its like, wow how many times does that have to be disproven to those people, aren't they adults?
They aren't useless in a society where the only means of survival is having a job.
In fact, in a society where the only means of survival is having a job, part of the social contract is 'everyone should be able to get a job'. Otherwise, you may get to meet a lot of angry, desperate people, with nothing to lose.
Vilifying a corporation that suddenly remembered they have a lot of random people don’t help generate revenue is odd. Similarly, assuming distress of a corporation when they remember to cut its workforce is just as odd. Its probably an accurate assumption, it just doesn't have to be and it would make more sense for corporations to be more nimble.
Everyone having an opportunity for employment is not dystopia. A real dystopia is when you have no good social safety net, but also have a large, unemployed underclass, which has no ability to make a living for themselves.
What value does Instacart offer in the world ? Why would people want to buy their stock ?
The market is going to love this because it will de-risk Instacart. Grocery stores should love this because they will be able to increase utilization of their employees. And of course employees, despite the popular narrative, will actually gain more power because they would have more localized work, and less competition. It's a win-win-win.
FWIW, the union referenced is at a Marianos, and Marianos (and all Kroger owned groceries) are unionized already. So the work is shifting from one union to another union.
Instacart is Homegrocer 2.0; and by that I mean an abysmally managed top-only company that only takes and does no re-investment. From what I can see their business model is, minimal investment, maximum unsustainable sort-term profit, and sell or go bankrupt while floating upon pool-in-yacht.
Their "customer care" staff are assigned multiple shoppers and customers to deal with simultaneously, and they are out of country NOT trained in English or US culture, as such they are clearly unable to communicate effectively; queue lines in the thousands.
I spoke with one once who told me they were NOT ALLOWED to communicate the fact they were dealing with multiple customers, with people just constantly spamming them because they could not keep up; a system which will obviously bottle neck at any load increase. Oh, and, according to her the entire system is "managed" by "If" statement masquerading as an "AI HR" software.
Once the vaccine comes out in full, Instacart will most likely be no-more or sold off.