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Amazon Delivering Groceries? It's Coming, Thanks To Sales-Tax Politics
curtwoodward writes "Amazon has been delivering groceries to people in its hometown of Seattle for a half-dozen years, but the experiment has never spread any further. But this year, rumors about Amazon Fresh expanding to new cities are coming out every month — Reuters just reported that Amazon could start the service in L.A. within a week, and in San Francisco in the coming months. What gives? Why expand now? Look no further than Amazon's long-running battle with state and federal governments over sales tax policy. After more than a decade of resistance, Amazon has spent the last two years cutting deals to collect sales taxes in states all over the country. And it's pushing for a national online sales-tax system, which appears to be within reach. That's the last obstacle to Amazon getting into the grocery-delivery game — a step that should worry not only grocers, but UPS and FedEx, too."
So in other words, Amazon has managed to lobby legislators into having a national internet sales tax which it can fairly easily implement (since it designed it and is a large company after all) in order to screw over both the average Joe AND make the playing field less competitive (the US tax code is far from simple...)
Gee thanks Amazon!
Taxation is legalized theft, no more, no less.
Look on the bright side, lots of possible organ donors.
wonder what part of "national sales tax" you missed. Everyone gets to pay sales tax on internet purchases going forward.
The part where that didn't happen.
As I just said in another post, there's no "internet sales tax", just the ability for states to require internet retailers to collect sales tax on sales to residents. If a state has no sales tax, there will continue to be no sales tax.
(I make no statement on whether the federal bill/law is good or bad, just that the name "internet sales tax" is apparently incredibly misleading.)
Look on the bright side, lots of possible organ donors.
And Amazon will deliver them while they're still fresh!
Sheesh, evil *and* a jerk. -- Jade
Except Amazon doesn't sell anything unless it has a UPC. Handmade? Micro-business? Too bad. Get your own shopping cart and implement TaxCloud.net.
Easy for a large multinational with full-time tax attorneys on staff to implement.
Painful for small businesses.
Part of the deal in this interstate sales tax bill is that participating states will make TaxCloud.net available to online retailers without charge. Integrating TaxCloud.net into a cart is supposed to be no more painful than integrating a payment processor or a shipping rate service.
The brick-and-mortar brigade has been bitching for years about the supposed "unfairness" of "they don't pay sales taxes but we do." They finally browbeat Congress into doing something.
Amazon's argument was about the burden of having to keep track of over seven thousand districts (I looked this number up.), having to update them the moment things change, and the legal penalties for any failure to keep track of changes. So they asked for, and got, a national single-tax regime, which, presumably, any business selling online can keep track of and meet, including the brick-and-mortarsaurs.
And if this is a disaster for the mortarsaurs, they will have only themselves to blame for the new K-T boundary.
You do if you want to keep your grand children out of the coal mine. The plutocrats who abuse their employees are still in power and work day and night to undo the protections that the unions have put in place for American workers. The price of freedom is eternal vigilance.
This has nothing to do with sales taxes. That's a few percent. It's all about efficient warehouse and distribution operations. Doing that wrong can double operating costs.
WebVan was a popular service during the dot-com boom. They just had an operating cost problem. They had about 3% market share in 30 cities, instead of 30% market share in 3 cities. So their order processing and delivery costs were too high.
One of WebVan's former executives realized that order processing had to be much more automated for this concept to work. So he founded Kiva Robotics. Upwards of 15% of online orders are handled by Kiva robots. If you've ordered from a major online retailer, (Acumen Brands, Drugstore.com, Gap, Toys-R-Us, Walgreens...) a Kiva robot probably handled the order.
Last year, Amazon bought Kiva Robotics. The whole company. Then they started building warehouses near major US cities and talking about same-day delivery. Those warehouses will have a lot of Kiva robots and not too many humans.
While some grocery chains like Safeway do delivery, they're not very good at it. They're picking from store shelves. So they don't know, when the order is taken, if the item is in stock. Safeway tends to deliver with some items missing. Automated warehousing operations know what they have in stock when the system takes the order.
It's going to be like Webvan again. But this time, it will be profitable. The retailers who see this coming are very afraid.
Fed Ex is non union and most drivers are not even employees.
When someone else assures you across the board that integrating something of theirs is [some level of difficult], into something of yours, where they know exactly nothing about your situation, work load, code, or available resources, you can be absolutely certain they have no idea whatsoever what they're talking about.
Further, for systems that implement home-grown shipping and payment, even the context is meaningless. "no more difficult" could be extremely difficult.
There are systems out there for whom the developers aren't even available any longer.
Whenever the government decides they're going to make every business, everywhere, do something, the load will neither be equal nor fair, and further, it may be fatal to the business for any number of reasons.
I've fallen off your lawn, and I can't get up.