IS AMAZON.COM THE VISION OF AMERICA’S FUTURE IN RETAIL?

 

…Amazon.com founder & CEO, Jeff Bezos

 

We customers don’t get to see the “real” Amazon behind the scenes.

First, I have to admit I have been an avid user of Amazon.com for years.  I must have been one of the first customer after the founder Jeff Bezos changed the company’s name in 1994 from “Cadabra”, from the magical “Abracadabra”, to Amazon.com.  (He said he changed because Cadabra sounded too much like “Cadaver”.) The Amazon.com site did not go live until 1995.

Now, it was not started in Silicon Valley as many people have assumed.  But it started instead, and is still headquartered in Seattle, Washington, and is today the world’s largest on-line retailer.  In addition, the company was not started by a young entrepreneur as was Microsoft, or Google, Face Book or  YouTube.

Jeff Bezos was also not a youth from a normal, American, middle-class family.  He was from a very wealthy family.  He went to the finest schools, was summa cum laude in 1986 at Princeton University.  Well before Amazon, Bezos was a high-paid, Wall Street investment banker at the power-house hedge fund, D.E. Shaw.

In his position at the hedge fund, Bezos had learned early on that the internet sales market was expected to explode and to increase by 2,300% each year beginning in 1994.  That was the spawning of what eventually became Bezos’ behemoth on-line retailer with 40, giant, US sales ”fulfillment centers” and 40 international sales “fulfillment centers”.

But as wonderful as Amazon has been as a low-cost, on-line supplier, all has not been a Rose Garden inside the giant operation.

First, one must look at the man that started Amazon.

Mr. Bezos has been christened by the media with the monikers of “Person of the Year” and including, “World’s Best Living CEO”.  But for all those 100,000 Amazon employees, the International Trade Union Confederation has given Mr. Bezos the prize winning name of “World’s Worst Boss”.

Even as a Wall Street Banker, Bezos was not considered as a warm human being.  One of his previous co-workers has stated that, “It was like he could be a Martian for all I knew.”

So, how could a super successful operation such as Amazon be run by this type of owner and top management person? 

Well, getting those very low Amazon prices and their very fast service comes at a very high expense from those that work at the giant, gated, and guarded fulfillment centers.

 

…One of the older, pre-automated Amazon fulfillment centers

These giant centers are referred to by those that know, as being totally “dehumanizing hives” for all Amazon line workers.

Listed here will give you a good idea of what these workers must live with in order to keep their jobs at any Amazon fulfillment center:

·       First, to get $10-$12 per hour pay, you do not work directly for Amazon.  Center workers are all temporary, seasonal or part time workers and they are employees of temp agencies that provide the center’s workers.  Therefore, when work slacks off, the workers are usually immediately let go. 

·       Many center workers are called “Workampers”.  These are modern Grapes of Wrath type migrants that travel in old RV campers taking whatever temp work they can get.  Amazon actually advertises on website that these workers frequent.

·       Workers are given a point system for getting their work done within the time allowed.  Each worker has a hand-held scanner. When a worker get the order to go find an item, the scanner tells them where it is and how long they have to retrieve the item and to get it to the shipping conveyor.  If it says 20 seconds, the worker must get it delivered it in 20 seconds.  If it takes longer, they are given a ½ demerit point.  If you accumulate more demerits, you get “counseled”, a few more and you are out the door.

·       No getting a drink of water or going to the restroom except on your two 15 min breaks or 30 minute lunch.  Many times the lunch rooms and overcrowded restrooms are 5-10 minutes walk from the individual’s work areas.  And the lines at the microwaves in the lunch rooms are like those for the restrooms.  Therefore, 15 minute breaks are more like 5 to 7 minutes, and lunches are ~15 minutes.

·       You may also be asked to work a 12 hour shift with no notice, (kinda tough if you have children w/ sitters or in day-care).  Workers are also not allowed to take-off on Christmas, Thanksgiving, Black Friday, Cyber Monday, Election Day, July 4^th, or Labor Day.  If you try, you are fired immediately.

·       Many of the centers are not air conditioned and in the Summer, they become literal sweat shops.  When it gets too hot to work, workers are let off to go home, but their pay is docked accordingly.  The workers are told that the lunch break is not 30 minutes, it’s 29 minutes and 59 seconds.  If you are not back at work on the exact time, you get more penalty points.  You must also use your own time to get through the lines at the metal detectors you have to go through to get to your job.

·       One writer wrote that, “Jeff Bezos would rather get the Ebola virus than be infected with a worker’s union at Amazon.”  By using temp agencies, Amazon has “plausible deniability” about any worker’s poor treatment.  Amazon also hires firms known as union-busting organizations for removing any whispers of a worker’s organization coming to Amazon.

 

…One of the new, giant, Amazon semi-automated fulfillment centers

You may have heard that Bezos acquired Kiva Systems for developing the special robotic “picker systems” to eliminate as many workers as possible.  Over 1300 Kiva robots already cover the floors at three of the newer Amazon centers.  The goal is to also have a drone system to deliver products in less than 24 hours and to have fulfillment centers with as few employees as possible.

Amazon/Kiva is now also designing similar automated fulfillment systems for The Gap, Staples and Walgreens.

My forecast is that it is only a matter of time where Amazon/Kiva and Wal-Mart will be getting together…..are these......Birds of a feather…?

Copyright  G.Ater  2014