Hey there !!
This is all over the news. My previous employer had nightmares about his business being challenged by Amazon….but why exactly ?
Why everyone fears Amazon right now ??
First of all, Interprog was founded in year 2000 and at the time it was all about Ebay regarding e-commerce. It was more or less the same challenge for everybody than today. You could walk in a store, talk to a sales guy for an hour until you really sure of what you want to buy….then walk out of the store and order it on Ebay. That suck for the brick & mortar business but that’s reality and it’s nothing new.
On Ebay I did well over 1000 transactions without even a single negative bad feedback. So I may be a little bit biased here though. I also probably receive a special service because my reputation is very very good but whatever.
Back to Amazon, they are sure a big player out there….the unique thing they have is a huge “farm” of distribution hubs to easily accomodate the customers quickly….but.
Yes, there’s a few “but”.
Well, multiples hubs or not….on Ebay you can choose where your seller is. You can read his ads, check his feedback rating, ask some questions. Or you can walk into a real store which is nearby as well if you wish. Amazon isn’t really stellar regarding the last mile delivery if you ask me…I’ll have a good example at the end of that text.
Unlike Ebay, with Amazon you don’t really deal with anybody. Someone with a reputation. Someone ready to do anything just to avoid that 1 negative feedback. They actually just ship product that they don’t own to customers they don’t really care….I don’t think anybody would do extra free overtime to get some box containing a 5$ item delivered just to make sure that the customer will be happy. An Ebay seller will. Any good company will also.
I’ve been there myself….being robbed by the son of some dad that stoled his credit card. I called the dad and asked him to just remove the bad feedback and I wouldn’t do anything about that 200$, which wasn’t peanuts for me at the time…but that’s business. I’m sure any good store out here write a ton of losses just to maintain their reputation of excellence. That’s how you become a market leader.
And now some examples….of course it’s a tiny sample, but still.
Recently I had to do a bit of special shopping for myself and a friend. Stuff a bit unusual to find so it was clear that Ebay or Amazon were the places to look at.
First of all, none of the 5 items were cheaper on Amazon. Some of them weren’t there at all, others had very poor descriptions, I wasn’t confident at all.
So all 5 were from Ebay. Hoping for the best !
You can probably see what I was doing there. I needed a small piece for a mobile phone that only China really have….5$ and really no promise on the shipping delay, I got it a while ago already. Easy game.
Then I had 3 components for a WIFI access point I need to install for a friend / customer. Those things are really expensive…unless they are used and on Ebay, of course. All of them were here the same day.
And since I broke my mobile phone well, I bought a new one. No problem there.
5 differents sellers, 5 differents points of origin, 5 differents expected delivery date….but guess what ?? Everything arrived with USPS -> Canada post, on time, without any issue at all !!
Now let’s take a look at the one everyone seems to be in love with….Amazon !!!
I made a new friend on internet and the guy wrote a book. I was curious so I bought it from Amazon. I’ve never had an amazon account so I had that “Prime member” trial good for 30 days that I had to cancel before they would charge me 100$ for it…..already it was a red alarm to me !! ( I just canceled it as we speak ).
So I was ready to order, july 12th, a wednesday at 14h00. Amazon showed that it would be here in 2-3 days. So I was expecting it on the following monday, at worst, right ?
I got an email on july 15th saying it was now shipped. Oh really, where I’m used to work we would ship in like 1 hour…not 3 days. Mind you the 15th is a saturday, I’m sure the book would be very very on track….but anyway. I also got not 1 but 3 emails saying that it was shipped. Last one showed this :
So, ordered on 12th, it said 2-3 days, we’re now expecting it on 19th….ok.
I know for a fact that the author is canadian, I was on amazon.ca also….so I wasn’t really expecting an “import fee” on that one. But whatever, it’s 1$.
But now what ??
On the 18th I received 2 identical emails. Guessing they like to spam people.
We’re on the 29th now, 10 days later….not a single update email. Mailbox is empty. I checked online 3 days ago and it showed the same thing as today.
My package will arrive with my favorite carrier UPS this evening apparently… NOT, it’s saturday !! And I hate UPS. They just can’t do anything right.
And finally, our opinion regarding the future of Amazon
The behemoth of logistics wholesale distribution that everyone on the planet fear right now…..well I ordered I simple book from a canadian author and they manage to take 3 days to ship it, they got it from Ontario, Canada and shipped it to the US for some reason, then it went back to Canada at Mirabel for some painful customs cleareance probably at the UPS depot in Lachine, there’s a note saying that the delivery was rescheduled because someone asked for it….well, WHO asked for it…not the guy that paid for it which is myself
And now it’s just “out for delivery” since last tuesday….nothing change. I’m here all day almost. UPS being UPS probably.
So I’m probably done writing about this….but just for my friends that are into the supply chain business. That image should probably help you sleep better at night.
If you don’t get it. Amazon sure have a lot of cashflow to inject into those distribution hubs. But it’s pretty much all coming from their profit with the AWS service….the “cloud” thing most people don’t even understand the purpose yet.
One thing that’s important to note though. They were alone for a while. There’s a HUGE growth potential with cloud computing, it’s there and it will be huge very very soon.
But the thing is….Microsoft is currently crushing them with the cloud business, Azure. And when I say crushing them…I mean CRUSHING THEM !! Microsoft has taken the lead and nobody will catch up anytime soon.
You can always mark my words….it’s easy, it’s written here !!
Waiting for his book, Interprog