How does Amazon make any money?

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Well, it looks like Amazon may have missed a delivery commitment for me today.

I ordered an 8-port gigabit switch (because I need more ports, who doesn't these days...) and it was due today. It's been "on the vehicle for delivery today" since 6 am. It's 9 pm now. I don't think it's coming.

If not here by 10 pm I'll report to Amazon and have them extend my prime subscription by a month, which is the usual recompense for a late Prime order delivery.

It's nothing to rend my clothes over, but I WAS LOOKING FORWARD to reconfiguring my network this evening. Sigh. First world problems, for sure.

Marc
 
I just had an interesting Amazon experience... My subscribe and save order this month was razor blades, cat food, and tide pods laundry detergent. I also had 2 regular orders in - a litter box for the cats, and a Christmas present for my 8-year old. Normally, they'll combine orders and this time was no different. I got a box with the razor blades and my daughters Christmas present. The rest of the order was combined into one 30# box, which I can only imagine the size of.

It never got past 'origin scan' somewhere in VA. So on Monday, 4 days after it was due, Amazon reshipped the entire order. The cats litter box was shipped overnight (in a huge box). The tide pods was shipped separately overnight, due yesterday, and is currently 3 hours down the NYS thruway. The cat food was shipped in a 3rd box (ground) and arrived on Wednesday (2nd day).

No idea how much the original and replacement shipping cost them, but it couldn't have been cheap...
 
I was praying for the sad bastard that had to deliver my Dog's Boots today, but he showed up and did his job.
I had to work when broken for awhile to make money, and it can be tough, but there's guys out there that never file a VA Compensation thing because they just figured out that you can still do things that are important enough to get paid for, but don't hurt as bad.
I'm trying to get to that place.
 
Oh, yeah, the point was that they are out there bombin' around in the dark, talking on their Cellphones sometimes, trying to make money.
I really hate seeing someone distracted from thier Job, but the roads are really Jenky around here if you are nhew, so maybe I don't hate the OOPS folks as much as I used to. I have Cameras, so if they have an OOPS I'll show it on my Youtube.
 
Read their financials. They really don't make any money other than on their AWS which folks think will somehow save them. They have good cash flow but from a shareholder perspective they don't make any money. Their reported profits are really almost rounding errors.

My company orders a lot of stuff from Amazon, to the point that I've actually gotten calls from Amazon higher ups when things go sideways. I often get multiple orders per day from them. But over the past year I have seen a marked decline in quality from a timeliness and fulfillment perspective. It has gotten so bad that I now order direct from the manufacturer rather than from Amazon. I get better pricing, much better packaging, and almost as fast shipping. My orders to amazon are in the $3,000-$5,000 each month and I used to rely on them to help me run my business. But they got so unreliable that I try to limit any critical purchases as much as possible. Lately they have started using 'independent contractors' to deliver during the day that sometimes I'm almost ready to call the police when I see some of their delivery people enter my business.

Sometimes I think they are purposely trying to lose me as a customer since maybe they lose money on me because of their Prime shipping.

Of course my experience may not be relevant to the consumer who orders a few times a month but it makes me wonder what they are up to.


Tony
 
This weekend I ordered something from Amazon that I never expected NOT to buy at a brick and mortar store.

A tire.

This summer I had a spectacular blowout on the freeway while towing my cargo trailer. Thankfully, it stayed (mostly) in one piece, I got to the side of the road and replaced it with one of my spares. Since then, I wire brushed and repainted the rim, but when I looked for a replacement trailer tire, there are none to be found. Tractor Supply Company, which is my usual "go to" store for trailer parts, will sell me a new tire WITH a rim, but I already have a rim. I just need a tire and, strangely, they don't sell the tires separately. Most places that sell car tires, like Wal-mart, Goodyear, etc. only carry car tires. So I looked online, and lo and behold, I can buy one through a vendor on Amazon for less than anything I could find anywhere near me despite paying ten bucks for shipping.

Weird.
Eventually, one won't have to leave the house to buy anything, just to go to work... unless one is replaced by AI expert systems or robots.
 
Lately they have started using 'independent contractors' to deliver during the day that sometimes I'm almost ready to call the police when I see some of their delivery people enter my business.
I think that would be their use of ONTRAC. Lots of complaints about them on Amazon, but the one time I've had something delivered by them, it was delivered on time and in fine condition. Supposedly, like Uber and Lyft, they hire anyone with a vehicle who then use the miracle of GPS and mapping apps... which might in some cases explain extremely late deliveries.

Of course my experience may not be relevant to the consumer who orders a few times a month but it makes me wonder what they are up to.
The use of on-line retailers is growing rapidly because of the great convenience, selection, and prices. I think they and the parcel shippers may be getting behind the power curve because of that rapid growth.

For all Christmas gifts, I just order Amazon holiday gift cards held in holiday themed cans and have them shipped to the recipients. "Holiday shopping" done with a few keystrokes and the recipients get to buy anything they want from a huge selection.
 
Had another missed delivery today. Not UPS or USPS but "Prestige" was the end deliverer. Was due by 9 pm, didn't show up.

This time the customer service rep did give me a month of free prime extension (~$8.25 value), rather than the $5 gift card credit. I've found, as in most things in life, the best thing to do is be very positive, clear about what you'd like, and polite at all times. Here's today's transcript.


Me: Hi. I'm chatting in reference to Order# XXXXXXX . It was due at 9 pm. It is now after 9:30, and the order has not arrived. I'm requesting an update on where this order is. Presuming it won't be delivered today, I'd like compensation for the late order, preferably in the form of a month extension to my prime subscription. Thank you.

You are now connected to Vinoth from Amazon.com


Vinoth: Hello, my name is Vinoth. I'm here to help you today.


Me: Hi Vinoth. Thank you.


Vinoth: Hi

I'm sorry for the delay in the shipment.

Please allow me a moment while I check this for you.


Me: Sure.


Vinoth: Thanks for waiting.


Me: No problem. Thank you


Vinoth: I'll be sure to forward this to the shipping department.


Me: Is there any sign of where the package is now?


Vinoth: Your package is in Indianapolis IN and it will be delivered within Monday, December 19, 2017.

We took all possible efforts to deliver the package on the date which we provided while you placed the order. However, the carrier has delayed delivery.

I understand that it’s our responsibility to deliver the package on time. As the final delivery has to be made by the carrier network, we certainly didn’t expect that this delay would happen.  

To compensate the inconvenience caused, I'll extend the Prime membership for one month.


Me: Thank you.


Vinoth: Please accept the Prime membership as token of my apology.


Me: Certainly. I appreciate it. Thank you for your quick and professional help.


Vinoth: I've extended the prime membership for one month.

Now your membership extends to Thursday, January 4, 2018


Me: Thank you Vinoth.


Vinoth: You're most welcome, Marc

Thanks for your understanding and patience with this.

Is there anything else I can assist you with today?


Me: Nope, thank you, you've been very helpful.​

In the survey that popped up after the chat, I gave him highest marks and in the text box reinforced that he was professional and courteous. I like to take the extra 15 secs to "promote" the CSRs that give me what I ask for.
 
I sat next to a CSR group for years. Sometimes they would take ridiculous abuse for things they had absolutely no control over. Our boss made it clear that if a customer got abusive, or started yelling, they were free to tell the customer that their behavior was unacceptable and they could hang up. This was a business to business call center so the customers were supposed to be professionals. Being a jerk to CSRs rarely works; they usually are to low on the food chain to offer a lot of help, but they can pass along how you treat them and sometimes management listens.
 
I sat next to a CSR group for years. Sometimes they would take ridiculous abuse for things they had absolutely no control over.
That's what I always tell them if my voice reflects some frustration they can detect. "I'm not blaming you. I know this is not your fault."
 
That was such an unusual first name that I looked it up. The information available on the Internet never ceases to amaze me:

https://www.namespedia.com/details/Vinoth

Although you could probably tell the nationality from an accent.

He might be the same guy that called me to tell me I owed the IRS a bunch of back taxes and that they were coming to arrest me if I didn't call him back immediately.
 
I just had an interesting Amazon experience... My subscribe and save order this month was razor blades, cat food, and tide pods laundry detergent. I also had 2 regular orders in - a litter box for the cats, and a Christmas present for my 8-year old. Normally, they'll combine orders and this time was no different. I got a box with the razor blades and my daughters Christmas present. The rest of the order was combined into one 30# box, which I can only imagine the size of.

It never got past 'origin scan' somewhere in VA. So on Monday, 4 days after it was due, Amazon reshipped the entire order. The cats litter box was shipped overnight (in a huge box). The tide pods was shipped separately overnight, due yesterday, and is currently 3 hours down the NYS thruway. The cat food was shipped in a 3rd box (ground) and arrived on Wednesday (2nd day).

No idea how much the original and replacement shipping cost them, but it couldn't have been cheap...

As a follow up to this - I got a UPS email today that I had a package out for delivery. That 30# box made it's way through the system and was out for delivery. I emailed Amazon to see if they wanted me to return it, and they told me to keep it - no charge for about $60 worth of product...

Chris
 
That was such an unusual first name that I looked it up. The information available on the Internet never ceases to amaze me:

https://www.namespedia.com/details/Vinoth

Although you could probably tell the nationality from an accent.
WHAT? You mean he probably wasn't in a call center in Dallas but rather India? Clutch the pearls in shock!
Sure, of course I would prefer not to offshore jobs. But he was helpful and did a good job for me.

Of course the package itself is out of his control. Hasn't shown up yet. "Out for delivery."
 
WHAT? You mean he probably wasn't in a call center in Dallas but rather India? Clutch the pearls in shock!
Sure, of course I would prefer not to offshore jobs. But he was helpful and did a good job for me.

Of course the package itself is out of his control. Hasn't shown up yet. "Out for delivery."
DO NOT automatically assume that curiosity about an unusual first name is an indication of bigotry. We don't want to need to establish "safe spaces" around here, do we? It don't care one bit about the melanin level in a person's skin nor about their nation of origin if they are competent at their job.
 
Agreed, no bigotry on your part intended Winston. Anybody who reads your posts understands this clearly. Sorry if my ambiguous sarcasm accidentally suggested otherwise!

And, the package arrived safely yesterday. All is well.
 
Looking just today for a few things to round out the toy shopping, I noticed something about the Prime items. Maybe it was just a coincidence, things are popular, or there are supply chain issues...but I found like a third of the Prime items I clicked on were "In Stock December 24th." Obviously, this means they would not be delivered before Christmas with Prime. So Amazon has millions of orders, and there have been some delivery issues around Christmases past. Is it too conspiratorial to imagine they are throttling the expectation of free shipping on shipments that come straight out of their pocket, in the several days before Christmas, to alleviate some of the potential problems with high volume?
 
Agreed, no bigotry on your part intended Winston. Anybody who reads your posts understands this clearly. Sorry if my ambiguous sarcasm accidentally suggested otherwise!
Sorry for my oversensitive "triggering." I've been hyper-sensitized by the absolutely BS levels of pathological political correctness and false accusations of bigotry and sexism during our last election.
 
They don't make any money per sale, but they make up for that with VOLUME! :wink:

Ha, that reminds me of a joke. Okay, first, this is not a politically correct joke, and I don't know how to rework it to make it one, so please, if you are offended, send me a PM and let's not start a flame war. I'll delete the post.

These three friends from West Virginia decided to go into business selling watermelons. One of them had a truck, so they went to a farm, bought 100 watermelons at a dollar a piece, then went into the city and sold them on a street corner for a dollar a piece. They sold out the first day.

But when they counted their money, they realized they had only broken even. This was perplexing, since they had sold out. But they realized, sometimes you have to be in business for a long time before you start to turn a profit; so they did this again everyday for a week.

But, still, they were just breaking even. So one of them said, "My cousin's a lawyer in Charlestown. He'll know how to help us."

So they went to the lawyer and explained the situation in detail.

The lawyer just shook his head. He looked at them and said, "You boys sure are dumb as a box of rocks. Anybody can see that you need a bigger truck!"
 
Yesterday I had a weird one. The Amazon seller, Instock Group, cancelled my order. I think it's a UK operation. Strange part was, I ordered it on Nov 26, and got the email saying it shipped on the 29th or something like that. I had a "delivery window" of Dec22 to Jan 7th. Yesterday I got an email from Amazon that the company cancelled the order. I'm guessing it never actually shipped, but hey, what do I know. There wasn't a tracking number, I assumed because it was coming from outside the US.
 
  • If you need it, go to McMaster
  • If you want it, go to Amazon
  • If you can't find it at either one...It's not made

Most people do not realize that Amazon makes a ton of money with something a lot of us use and don't even know it...AWS (Amazon Web Services).

Do you mean like the $600 million dollar CIA cloud computing contract?
 
snipped for brevity
...Most people do not realize that Amazon makes a ton of money with something a lot of us use and don't even know it...AWS (Amazon Web Services)....
Hmm, lets check that out:

"Amazon's cloud business, Amazon Web Services, continues to drive the company's growth. AWS is the most profitable business for Amazon, bringing in $861 million in operating income, more than double last year's $428 million, at a solid 26% margin."

So $861 million in operating income from AWS. By Amazon's standards that's not a ton of money. Total net income for that quarter (3rd of 2016) was $252 million. Total revenue was $32.7 billion. So net income was 0.77% of total revenue. Just breaking even. But that's because so much cash is plowed back into operations. 2/3rds of the AWS income was offset by losses in other sectors of Amazon.

For a company with the scale of Amazon $252 million is almost a rounding error. Folks keep waiting for the giant cash income spigot to open but so far Bezos has keep all the other taps open, draining away any significant profits.

At this point a lot of investors want Amazon to spin off AWS so all the profit isn't diluted by the losses in other areas of the company. But Bezos will never do that as right now it's the main reason Amazon isn't showing losses every quarter.


Tony

source for numbers :https://www.businessinsider.com/amazon-earnings-q3-2016-2016-10
 
Or... Amazon has operated below or near the margin since forever, targeting growth instead of profit.
 
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