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What “Amazon Supply Chain Services” tells us about what Amazon is

gadallon.substack.com

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Re: What “Amazon Supply Chain Services” tells us about what Amazon is

#11

Post by steveBK123 »

SoftTalker wrote: post #6

The pattern is quite simple. Build infrastructure to serve internal operations at a scale no rational external buyer would justify. Optimize it to a level that drives marginal cost below the buyer’s internal alternative. When the surplus capacity is too large to write off, open the API and sell it. Forgot the last part: when you have eliminated all the competition and have all your customers locked in with no other o…

> Forgot the last part: when you have eliminated all the competition and have all your customers locked in with no other options, raise the price.

AND don't forget to degrade services as well

Re: What “Amazon Supply Chain Services” tells us about what Amazon is

#12

Post by varispeed »

nhance wrote: post #3

These types of services almost seem squarely in the space of what governments should/could do with intelligent leadership. It is probably not too late for a state-driven type of service layer like this from some rationally led government somewhere in the world.

It has nothing to do with intelligent leadership, but departments founded to prevent such things from happening are not doing their jobs. Basically civil servants prefer to not rock the boat and sail through to retirement.

Re: What “Amazon Supply Chain Services” tells us about what Amazon is

#13

Post by gruez »

deaton wrote: post #9
gruez wrote: post #5

Earlier quoted context omitted.

USPS should get into the business of running whitelabel warehouses?

I mean it seems to make good money

Should the government also get in the business of drilling for oil, or making medical products, because "it seems to make good money"?

Re: What “Amazon Supply Chain Services” tells us about what Amazon is

#15

Post by kikoreis »

This read was mildly interesting, but I'm left thinking that the study of any sprawling monopoly will come up with similar mildly interesting and irrelevant rationalizations of success. Once you get as as big as Amazon was in the early 2010s, provided your culture doesn't melt down (by itself no small feat), you are well positioned to expand and flatten adjacent parts of the economy.

So the question is whether you read this to be inspired by it and attempt to create your own monopoly, or to be afraid of it and start thinking about regulation. Or both :-)

Re: What “Amazon Supply Chain Services” tells us about what Amazon is

#16

Post by JumpCrisscross »

kikoreis wrote: post #15

This read was mildly interesting, but I'm left thinking that the study of any sprawling monopoly will come up with similar mildly interesting and irrelevant rationalizations of success. Once you get as as big as Amazon was in the early 2010s, provided your culture doesn't melt down (by itself no small feat), you are well positioned to expand and flatten adjacent parts of the economy. So the question is whether you re…

> you are well positioned to expand and flatten adjacent parts of the economy

Yet others with Amazon’s scale have tried and failed at this sort of horizontal integration.

Re: What “Amazon Supply Chain Services” tells us about what Amazon is

#17

Post by kikoreis »

JumpCrisscross wrote: post #14
treis wrote: post #7

This gets the story of AWS wrong and it should be fundamentally suspect because of that.

> This gets the story of AWS wrong How?

It's not completely wrong, but overly simplistic:

> In 2006, Amazon launched what is now AWS, exposing the internal compute, storage, and database services its retail group had built. The internal pitch was identical to Marketplace seven years earlier.

These were not internal services, and it wasn't exactly the retail group that built them (Chris and Ben were dedicated to EC2 and the team ran remote from Seattle). Nor was Marketplace run on the 1P Amazon platform, so it would have been a strange analogy to use for a pitch.

In the end, though, the point is the same as I made elsewhere in the thread — once you are big enough you can try and bootstrap pretty much anything adjacent to your business and have a good shot at success.

Re: What “Amazon Supply Chain Services” tells us about what Amazon is

#18

Post by nmcfarl »

What this mainly says to me is that my life is going to get much worse - as Amazon logistics cannot deliver to my house.

I used to be a big user of Amazon prime, but they recently swapped over to logistics for my rural area which has no cell service and huge distances between houses and that apparently means they can’t deliver. They try and packages sit at the local warehouse for a couple of weeks before being sent back to Amazon.

Originally, some drivers would be foolish enough to try to come up here without cell, but by and large, they were unable to find the property- mainly because the house is not visible from the road, even if the mailbox is on the road, and mapping apps do a bad job. So I’m assuming the drivers don’t get paid or in some other way get punished and this means that a bunch of Christmas presents didn’t show up, and we stopped using Amazon entirely.

Since that we’ve already had a problem with one vendor we purchased from directly that tried to send something to us via Amazon logistics, and it got returned to them. This was not mentioned on the webpage, and when we contacted them, they got really angry with us for giving them an “undeliverable address” – they literally did not want to give us a refund. They really didn’t like: It’s deliverable by USPS, UPS, and FedEx as a response. But eventually, we got a refund.

I’m assuming this is going to be my future more and more now.

Re: What “Amazon Supply Chain Services” tells us about what Amazon is

#19

Post by dan_sbl »

I wanted to find this interesting, but it has AI/LLM signs of writing all over it.

The dig in the middle - "you can skip the next part, but if you do skip, are you even a real reader? Not judging. Just saying" - ugh. Why would I bother reading every word if you likely didn't write every word?

Re: What “Amazon Supply Chain Services” tells us about what Amazon is

#20

Post by NickC25 »

SoftTalker wrote: post #6

The pattern is quite simple. Build infrastructure to serve internal operations at a scale no rational external buyer would justify. Optimize it to a level that drives marginal cost below the buyer’s internal alternative. When the surplus capacity is too large to write off, open the API and sell it. Forgot the last part: when you have eliminated all the competition and have all your customers locked in with no other o…

break. up. Amazon.

break up Apple, Meta, MSFT, etc... while we're at it.

Or, keep it simpler - if a company passes a market cap of 1 trillion dollars, they must forgo lobbying and "government relations". if you're worth a trillion dollars or more, you don't need the government to hold your hand.

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