Amazon Targets Unprofitable Items, with a Sharper Focus on the Bottom Line

If by “killed”, you mean I use Target, Home Depot, and Walmart pickup without issue.

> Their negotiated rates aren't better, and they are actually forcing sellers to buy USPS postage with Amazon's account instead of the sellers.

It's true that you're forced to buy with Amazon's account, but this is shipping spending that would've been paid for by Amazon anyway. The merchants are not losing out on any volume discounts, since this was never "their" volume anyways.

IMO, this is the way to think about this: if the Amazon-negotiated rate for warehouse -> customer shipping is lower than what the FBA fee would've been (which it often is), the merchant is coming out ahead.

> Seller Prime is a couple years old now and it seemed to backfire on them and it seems they are trying to push sellers off of it by enforcing near impossible to meet standards that even Amazon themselves don't meet.

Yes it's about 2 years old, but it wasn't something that was widely popping up on Seller Central dashboards until earlier this year. I don't know whether you're referring to the ship-out time requirements, but so far my company hasn't had any issues with SFP. Better yet, the merchant controls which items are fulfilled under SFP, and which are FBA.

They still haven't converted everything and don't even really need to. AWS duplicated a lot of internal stuff, it didn't really replace it.

Seems like this depends on who you ask? (https://techcrunch.com/2016/07/02/andy-jassys-brief-history-...)

> "It began way back in the 2000 timeframe when the company wanted to launch an e-commerce service called Merchant.com to help third-party merchants like Target or Marks & Spencer build online shopping sites on top of Amazon’s e-commerce engine...At that point, the company took its first step toward building the AWS business by untangling that mess into a set of well-documented APIs."

> "The internal teams at Amazon required a set of common infrastructure services everyone could access without reinventing the wheel every time, and that’s precisely what Amazon set out to build — and that’s when they began to realize they might have something bigger."

> As the team worked, Jassy recalled, they realized they had also become quite good at running infrastructure services like compute, storage and database (due to those previously articulated internal requirements). What’s more, they had become highly skilled at running reliable, scalable, cost-effective data centers out of need. As a low-margin business like Amazon, they had to be as lean and efficient as possible.

> "It was at that point, without even fully articulating it, that they started to formulate the idea of what AWS could be, and they began to wonder if they had an additional business providing infrastructure services to developers."

From The Everything Store:

>"Groups within Amazon were told to use AWS while the services were still immature, a demand that led to another round of consternation among its engineers." (Page 221)

I guess we could say that AWS's first customer was not necessarily Amazon, but the team and infrastructure predated AWS, and AWS was used by Amazon internally.

Considering what we inflicted on wolves (Pugs being one notable example), your characterization might not be a terrible definition for "dogfooding".

My company easily does 6 figures in shipping spending across UPS and FedEx annually (on non-Amazon shipping). What we're paying for SFP shipping is at worst equal to, and at best 20% below, what our own rate tables quote.

YMMV, but given the variety in what Amazon merchants ship in terms of size, weight, hazardous/insurance status (not to mention shipping origin and destination), don't you think it's a tad glib to tell me I'm "confused"?

Highly impractical, it would probably not work. You'd probably end up needing to bury a series of tubes under ground to transport it around, and how would that work? no one knows!

It's very rare that Amazon ships multiples items in the same box to me, so I'm doubtful the impact will be very high.

already have this problem. we order a lot via amazon, and it's not uncommon to get a package from both UPS and the amazon "gig" delivery folks.

... and also means that they reduce competitor barriers by essentially taking themselves out of the loop; jet can offer “jash” buttons tomorrow with a similar arrangement.

Put another way, very little in all of this accounts for consumer needs/wants/experience. Force me to use pantry or buy larger quantities at higher unit prices? Nah. I’ll just use target’s drive up and have it in the quantity I want in two hours or less. At the same time, as Amazon slips in service and shipping times, other smaller online retailers are getting much faster and cleaner experiences that also avoid the numerous fake reviews.

Amazon seems to be acting as if they have a stronger position with a more loyal or locked in customers than they do - and I’m happy to start looking at other options.

I'd expect Coke to be a high margin product. Supermarket own brand colas sell for a tenth of the price.