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The Illusion of a Profitable Amazon Prime Now and Prime Fresh

stratelogical.com

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Re: The Illusion of a Profitable Amazon Prime Now and Prime Fresh

#11
post #6

I tell you, this service has been a godsend. Emergency trip to the hospital, no food at home? Prime Now. Living alone sick, no food in the home? Prime Now. Parents feeling poorly and I'm 3 states away? Prime Now.

[edit] Disregard, can't ask an earnest question on HN either.

Anecdotal, but I don't have that. And I don't feel like I'm an outlier.

Re: The Illusion of a Profitable Amazon Prime Now and Prime Fresh

#12
post #6

I tell you, this service has been a godsend. Emergency trip to the hospital, no food at home? Prime Now. Living alone sick, no food in the home? Prime Now. Parents feeling poorly and I'm 3 states away? Prime Now.

[edit] Disregard, can't ask an earnest question on HN either.

There's a difference between literally no food at home and no fresh food. You could of course eat a can of beans that has been sitting there since Obama was in office, but you'd really rather a fresh meal.

Re: The Illusion of a Profitable Amazon Prime Now and Prime Fresh

#13
post #6

I tell you, this service has been a godsend. Emergency trip to the hospital, no food at home? Prime Now. Living alone sick, no food in the home? Prime Now. Parents feeling poorly and I'm 3 states away? Prime Now.

[edit] Disregard, can't ask an earnest question on HN either.

> Is this a common state of affairs? Who doesn't have at least a week's supply of food and water in their home?

I cant tell if this is a serious question? I definitely do not have more than 1 weeks worth of food in my home.

Re: The Illusion of a Profitable Amazon Prime Now and Prime Fresh

#14
post #6

I tell you, this service has been a godsend. Emergency trip to the hospital, no food at home? Prime Now. Living alone sick, no food in the home? Prime Now. Parents feeling poorly and I'm 3 states away? Prime Now.

[edit] Disregard, can't ask an earnest question on HN either.

>Is this a common state of affairs? Who doesn't have at least a week's supply of food

On the morning of the grocery shopping day, I'd guess most families do not have 7 days of food left to eat.

In America, the average # of grocery trips per week was ~2.[1]

That frequency doesn't seem so strange if the number of trips is affected by: (1) family size such as 4 people including 2 parents + 2 children, (2) refrigerator size of typically less than 20 cu ft (not the luxury 28+ cu ft or extra refrigerator in the garage), and (3) preference for fresh & perishable food instead of canned items.

[1] https://www.statista.com/statistics/251728/weekly-number-of-...

Re: The Illusion of a Profitable Amazon Prime Now and Prime Fresh

#16
The author dramatically underestimates the opportunities of scale and future tech in her model.

Amazon is already:

- Installing lockers into apartment communities https://www.amazon.com/b?ie=UTF8&node=6442600011 that make deliveries dramatically more efficient.

- Predictive logistics & ordering patterns are a core Amazon discipline and they are world class at it.

- Droning looks like a gimmick today, but why should it be in the future?

Imagine a not-far-out future where: - Predictive ordering algos keep right balance of product on hand - Order comes in, robot loads it from GIANT physical warehouse that is NOT in a city center - Order is sorted into a "locker" or a "single" end point - Locker end points are put onto a locker-loading vehicle that runs a daily route that ties into the 2hr timeline. - Single points deliveries are brought by automated heavy delivery truck to city center range from which point they are either droned or courier delivered

- - -

That future ain't that far off folks.

And in the meantime Amazon, who has their shareholders trained to reinvest every dollar of profit into their scale, is going to go and corner the multi-trillion dollar grocery & last mile market.

Re: The Illusion of a Profitable Amazon Prime Now and Prime Fresh

#17

I tell you, this service has been a godsend. Emergency trip to the hospital, no food at home? Prime Now. Living alone sick, no food in the home? Prime Now. Parents feeling poorly and I'm 3 states away? Prime Now.

You could say the same thing for UberEats ;)

Re: The Illusion of a Profitable Amazon Prime Now and Prime Fresh

#18
post #6

I tell you, this service has been a godsend. Emergency trip to the hospital, no food at home? Prime Now. Living alone sick, no food in the home? Prime Now. Parents feeling poorly and I'm 3 states away? Prime Now.

[edit] Disregard, can't ask an earnest question on HN either.

Yeah my dude, I'd almost venture to say that you are the outlier here (echo/bubbles, yay!). For many that I know, food is an on-demand lazy loaded resource. Sure, sometimes they buy groceries (usually when they run out of pop-tarts) ... But the odd day when they actually cook dinner, it's a trip to the store for just those ingredients that are necessary.

Is it horribly wasteful and inefficient? yes. Does that get factored into the equation? no.

Re: The Illusion of a Profitable Amazon Prime Now and Prime Fresh

#19
post #5

If you assume a driver’s wage is at least the Seattle minimum wage of $15 per hour, add nominal fulfillment and delivery costs of $5 per order (the contractor’s fuel, car etc.) and nominal sales and marketing and general administration costs of $5 per order, Amazon needs to fulfill close to eight minimum order ($35) deliveries per hour to breakeven just on the variable costs Across 25 associates, the average number o…

Yes, you are right. But increasing adoption across different zipcodes won't help that much (although, yes, it’ll bring SG&A per order down). The adoption has to increase in the exact same area (your point #2 has to be true, i.e. stops should be so close, like an apartment building) for drivers to make more orders per hour, and for this service to be profitable in the long run.
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