Amazon Angling For Same-Day Delivery Beyond Groceries

New submitter lipanitech writes with an except from an interesting look at the upcoming reality of same-day delivery for many customers within reach of the Amazon delivery supply chain: "The vision goes well beyond just groceries. Groceries are a Trojan Horse. The dirty secret of Amazon is that it really doesn't distinguish between a head of lettuce and a big screen TV. If Amazon can pull off same-day grocery delivery in NYC, it ostensibly means consumers can order anything online and receive it the same day. By logical extension, that means Jeff Bezos, the CEO of Amazon, is on the cusp of rendering every retailer on earth obsolete." While I'm happy to order dry goods like electronics online, I've always been skeptical of other people picking out my groceries. On the other hand, I must admit that (at least in its Seattle delivery area) Amazon Fresh does an impressive job of delivering decent produce.

Comments

Fresh Direct

[MightyYar]

We used "Fresh Direct" when we lived in NYC and we were usually happier with the produce than if we got it at the grimy Food Emporium. It was quite popular, so I don't think it would take long for people to get used to grocery delivery. The one hang-up: in NYC there are doormen. I'm not sure how you get groceries without a doorman unless they just leave it on your front stoop!

Re:Fresh Direct

[fhuglegads]

I use Flesh Direct for all my escort services.

Re:Fresh Direct

[MightyYar]

Actually we were living in subsidized hospital housing while my wife did her training, and we used Fresh Direct for the price and quality. There were no shortage of "organic" and gourmet overpriced groceries where the other half shopped. But thanks for revealing your biases so transparently... makes it easier to filter what you have to say.

Re:Fresh Direct

[Samantha Wright]

Free-range Doritos are a totally real thing. Google says so.

Re:Fresh Direct

[cayenne8]

Hmm...I guess I'm not familiar with this "doorman" situation. Is this like a guard or something for people living in apartments there?

That being said, I guess delivered groceries do well for people that don't cook, and no reheating something in the microwave or boiling in a bag does not count for cooking.

But I like to cook from scratch whenever possible. I'd not feel confident that someone picking out produce, or seafood or meat would pick out the best looking selections, but instead would be looking more to rotate stock so that oldest is going out.

I like to pick up, squeeze, look at and smell my ingredients and get the best I can find for myself.

But I've noticed that so many folks today in the US, just don't seem to know how to cook anymore. Hell, I've not dated a woman in awhile that knew how to cook even, I've had to show several girlfriends how to prep and do food.

Although I think it is changing back a bit and people are more interested in the foods they eat and fix home cooked meals, we have a long way to go on that front.

But no thanks...I'll get my own groceries. I get the best deals that way. I look on Wed. to see what's going to be on sale at the various grocery stores, and plan my route on the weekend to hit 2-3 of them to get the sale items, and I build some of my weekly cooking around that. I eat quite well and don't spend all that much as others do with pre-packaged, processed crap food.

Re:Fresh Direct

[the_B0fh]

flaming is not trolling. And some people deserve to be flamed.

Re:Fresh Direct

[xaxa]

Loads of people in London use online grocery delivery services.

Amazon don't do this -- the four oligopolistic supermarkets all do. They offer timed deliveries, within an hour or two-hour slot, at varying cost (sometimes free). They promise to choose the food as you ask -- e.g. you can ask for very ripe fruit, or unripe fruit, or furthest-future use-by dates. I don't know how reliable this is. I used the service once, from the cheaper supermarket that offers it (Asda), when I last moved house. It was convenient, but not enough to use it again. I spend enough time on the computer already, I don't mind wandering round a shop choosing food.

I'm clearly in their target demographic (late 20s and no children, from my "loyalty" card) and I'm always handed a voucher for "£15 off your first online delivery when you spend £60" when I buy things in Sainsbury's.

I don't buy ready-meals etc. I think people buying them would be less likely to use the delivery service, since it's pretty easy to stop in at a smaller supermarket on the way home and pick from the refrigerated boxes. Quicker than picking vegetables etc.

(There's no doorman on my building, with ~120 flats. I thought that was a super-luxury thing. We have a caretaker, but he doesn't answer the door for deliveries. I don't know if larger buildings in London/UK have them.)

Re:Fresh Direct

[ArcadeMan]

And when the electricity is out and you can't use the Internet anymore, use your Flesh Light.

Town centers

[Anonymous Coward]

I think we have to worry about the vitality of town centers as Amazon and other online merchants continue to take away their business. They've already been battered by Wal-Mart and other big box stores, but this could be the finishing blow.

*NOT* feeling sorry for merchants here, but this is a quality of life issue. Do we want the country turned into one deep suburb where everyone orders what they want from their living room couch?

Re:Town centers

[DogDude]

I normally don't respond to AC's, but you hit the mail on the head. I think that most people don't care if the country turns into one giant suburb where everybody orders what they want from their couch. It's more of the increasingly pervasive "Fuck you. I've got mine" mentality. Lovely, isn't it?

Re:Town centers

[TWX]

Before urbanization, we used to order much of what we bought from catalogs. You could order everything from shoelaces to a prefab house kit from the Sears Catalog, and if you lived in a rural place, you pretty much had to mail-order.

One can argue that the retail shopping experience that we've come to regard as the norm didn't really appear until the middle-class started shopping like the upper class did, where choice became possible and one could actually discriminate between objects to purchase. It's fairly expensive to run a retail store that's packed full of merchandise that lets everyone touch everything. You have to have plenty of floor space. You have to have pretty displays and lots of bright lighting. You have to clean up after the customers. You have to stock things speculatively en masse, and have to discount merchandise that doesn't sell but try to strike a balance between that discounted merch and full-retail prices for other merchandise, lest people not buy your full-price stuff and instead opt for the cheap stuff. And you have to deal with all of the inevitable clashes between your staff and the public, and between members of your staff.

A catalog service does away or shrinks many of these issues. Floorspace and lighting are what's OSHA-mandated. Appearance isn't so much an issue so long as the warehouse is kept tidy enough to avoid damaging the merchandise, and the warehouse can go decades between remodels if it's set up right in the first place. Less staff and no public browsing means no staff-public interaction problems, and if the staff is kept busy pulling and shipping merchandise, less staff-to-staff problems. The warehouse can also actually stock less materials if they want, so if something doesn't sell they don't have as much of it on hand as they might in retail stores, and since online it seems harder to compare this discounted thing with this full-priced thing on a tangible level, it might not even cannibalize full-priced sales.

I like some retail shopping, but sometimes it's really annoying, and I think there's plenty of good in a mail-order or internet-order catalog to make up for the negatives.

Re:Town centers

[Ol Olsoc]

Before urbanization, we used to order much of what we bought from catalogs. You could order everything from shoelaces to a prefab house kit from the Sears Catalog, and if you lived in a rural place, you pretty much had to mail-order.

-snip-

I like some retail shopping, but sometimes it's really annoying, and I think there's plenty of good in a mail-order or internet-order catalog to make up for the negatives.

This so very much! The internetZ have just become the catalog of the 21st century.

Brick and mortar stores have some great advantages, but they have gotten so far from where they should be that it isn't worth the effort to attempt to shop there.

Example:

I wanted some simple hardware parts. I check my local Lowe's. Well, it turns out that these inexpensive parts don't have much of a profit margin, so they don't carry them. But they do have a thousand 5 gallon buckets of Contractor grade (cheap) wall paint. After 10 or 11 trips, I cross them off my source list. So it's online ordering for that stuff.

Example:

I need some computer parts. A stereo capable external sound card. Not exactly everyday stuff, but not exactly a SCSI hard drive and adapter either.

Stop off at best Buy and other folks that sell this kind of thing. No luck. Anything other than 50 varieties of Windows 8 running computers/laptops, they don't have much at all. And any peripherals are so overpriced - 30 dollars for a 6 foot cat5 cable is a sin. After about the 10th time, I give up checking them out, also.

How does this happen? If they have the stuff, it's likely to cost 4 to 5 times what I can get it for online. If they have it. But odds are tehy won't, because in their world, you don't have items that are low profit margin, or the least bit obscure.

Well, these big box retailers have an army of accountants and headquarters middle managers to support, so their overhead structure depends on a lot of sales and a lot of profit. And since accountants are notoriously difficult to purge from a company, they cut back on store staff if they can. But still, that Cat5 Cable or left handed widget is supporting the store employees the store overhead, and an army of people at HQ.

And the really sad part is that the accounts who are telling these folks how to run their operations don't see the little stuff as important. After all, they might only make a buck on that left handed widget, and that valuable store space can be used for a higher profit item. But they fail in that eventually. Accountants know numbers, but they largly do not understand people. I don't waste my time going there because tehy won't have what I need, and I can save time and money ordering online. How much money do I spend in a store if I don't go to that store. They have become irrelevant.

Re:Town centers

[__aaeihw9960]

I think you're confusing big-box stores with retail in general. Big box stores carry more of high profit margin items, and rarely, if ever, of low-profit/low-demand items. That is correct.

Where you go wrong, though, is that all stores are like this. For example, a local hardware store had everything (and I mean everything) I needed to remodel my basement. From the hammer and nails to the specialty trim. They didn't have a lot of each thing, and I paid a little more for convenience, but they had it. The local computer parts store carries everything from 50'+ HDMI cables to 2-pin adapters, from power supplies to charging pads for remote controlled helicopters. They might only have one or two of each thing, but their prices are competitive with on-line, and they do good business.

In other words, retail is more than just big box stores. There are countless small shops just like the two I mention.

Re:Town centers

[dywolf]

even though the catalogs may have "had everything", you didnt order "everything". only things you couldnt get locally, even if local meant a 10/20 mile horde/buggy ride to town. which they did regularly, whether regularly was once a month or once a week. hell, as it was delivery was to the town, not your door, so you still had to go get it.

we're getting mroe and more to the point where you physically cannot get things locally. the big box stores pushed out the local vendors with cheap plastic crap. and now even the big box stores are slowly being pushed out by the online stores.

In thr '60's

[zaax]

All the family foods was delivered (mostly by the co-op) to the door or at least to the road side were housewifes used to to go the van and get there meat; vegetable and fisg. Of course the milkman and bread man came to the door.

I've been in the grocery business..

[HockeyPuck]

There's a certain advantage to the online or delivery based grocery stores. They don't need to manage as packaged and portioned product as the traditional grocery stores.

Take meat for example.

In a traditional grocery store, there's hundreds of cuts of meat that are packaged up into individual portions sitting in a refrigerator waiting to be picked up by some consumer. There's a good chance that it won't be picked up and will eventually need to be tossed. Also, storing cut up meat isn't as efficient as say storing an entire side of beef/whole chicken/pork etc..

With the on-demand grocery, the side of beef is whole until an order is placed and then that side is cut up as per the orders that are needed. So if you need 50 steaks, you cut up exactly 50 steaks. Compared that to the traditional store in which you have to base that days sales on historical numbers and predictions rather than actual orders.

  If you as a meat-dept manager guess that 100 steaks will be sold on a thursday and only 50 are sold, you're going to lose money. With the online butcher, you only cut up 50 steaks. In this case you're much more efficient as you have less product waste.

It's the same with any other type of produce, also the shipping of produce from warehouse to grocery store via truck induces more issues around bruising/spoilage/damage etc. If it's sent to your house directly from the warehouse, then that's one less organization that your product has to pass through, thereby enabling you to have a better product. I'm also sure they'd allow you to refuse product say if for example, eggs were damaged.

The problem with the online is the same one as the movie rental business started out with. The impulse buy. Grocery stores are great at this, you walk by the steak counter and decide "this looks good, i'll have steak tonight". Online didn't have this ability as you had to wait a day or two to get your steak. Netflix had this problem vs. rental stores as you couldn't just do an impulse "movie night" if they had to ship you a dvd. Now with Netflix-streaming you can have a 'movie-night' as an impulse b/c the movie is provided to you the same day.

Re:I've been in the grocery business..

[dywolf]

something tells me you've never worked a meat department.
1: you dont just go to a side of side and cut off a steak
2: it's not held as a side. it comes in vac bags of individual muscles (ribs, chuck, tenderloin, flank, shoulder, rump, loin, etc), each of which can only be cut into a handful of "cuts", such as flank, ribeye, new york strip, sirloin, etc.
3: there's a time limit on that "side of beef" whether you cut it or not. vac bags the muscles come in may last a bit longer than the prepared steaks on display, but thats due to the higher quality packaging (and some meat departments use vac sealers), and even so doesnt extend life a whole lot. the meat is only sellable for about 21 days (numbers may be rusty...been awhile) even in a vac bag.
4: most meat counters do custom cuts (speaking of thickness) on demand, and vary the cuts on display as well by a quarter to an inch or more, to give a selection to the customer. that is, outside of Walmart which does all processing at a central plant, rather than in store.

Re:I've been in the grocery business..

[DerekLyons]

In a traditional grocery store, there's hundreds of cuts of meat that are packaged up into individual portions sitting in a refrigerator waiting to be picked up by some consumer. There's a good chance that it won't be picked up and will eventually need to be tossed. Also, storing cut up meat isn't as efficient as say storing an entire side of beef/whole chicken/pork etc..

There may be hundreds of packages but there's only a few dozen different cuts. And the retailers long ago figured out how to optimize their display (in types and quantities) so as to minimize the amount that's tossed. (And they then minimize that amount even further by discounting it a day or two before it goes off.) Nor do they store cuts of meat, it's cut (almost universally) on demand on a daily basis. (If it's not cut on site, it either comes frozen or is cut on a regional basis and delivered every couple of days at worst.)
 

With the on-demand grocery, the side of beef is whole until an order is placed and then that side is cut up as per the orders that are needed. So if you need 50 steaks, you cut up exactly 50 steaks. Compared that to the traditional store in which you have to base that days sales on historical numbers and predictions rather than actual orders. If you as a meat-dept manager guess that 100 steaks will be sold on a thursday and only 50 are sold, you're going to lose money. With the online butcher, you only cut up 50 steaks. In this case you're much more efficient as you have less product waste.

Um... you do know that meat lasts more than a day don't you? If they do miss their Thursday numbers that badly, they just cut fewer on Friday. (Not to mention it's pretty rare to cut a whole days worth at once - there isn't sufficient display and storage space, instead the butchers cut steaks every couple of hours as needed.)

Not to mention, grocery store butchers haven't worked with whole sides in a long time... Not only is there considerable waste on a side (which costs to ship), there's a considerable imbalance in demand between various cuts from a given side. Instead, they order what are called primals and cut those up as required. (Also much of the 'waste' is valuable byproduct for sausage making, fats for various uses, etc... this is much more efficiently balanced at the wholesale/salughterhouse level than at the individual grocery level.)

So, yeah, pretty much everything you said is BS.

Re:I've been in the grocery business..

[DerekLyons]

. I didn't know there were any grocery stores that didnt' cut up their own meat and package it?

Few, if any, places cut their own chicken. Other than that, Wal-Mart often has a regional butcher rather than one on site, and there are also some 'brand name' meats starting to spread that come to grocery store already packed.

Maybe they deserve it

[MetalliQaZ]

Look, I don't want an Amazon monopoly of all of retail any more than the next guy, but maybe these brick-and-mortar chains deserve it. So much of the retail space has been taken over by large corporations that offer better prices than mom-and-pop stores but lack any semblance of customer service. Their employees aren't trained, and the products are exactly the same junk you find everywhere else. They just aren't a good experience.

I especially hate how they have resisted integrating with the online world. It drives me nuts when a company has both a large online presence and a brick-and-mortar presence. Even though they share the same branding and (usually) the same product selection, they function as if they are separate companies. If you have a problem and try to talk to a person at your local store, they say "we don't deal with the online stuff, they are independent from us." Well great, way to give up your ONE advantage over Amazon.

Give the customer what they want. They want the convenience of online shopping. They also want face-to-face sometimes. They blew it. Amazon's same day deliver will be close enough to bury them.

Seen this before...

[yakatz]

I have ordered items (non-food) on Amazon and had the option to pay ....... $3.99! ..... for "Same Day Delivery" in the Washington, DC area. I have no idea how they actually paid for the courier to drive from Virginia to Maryland, since it certainly cost more than $3.99 in gas, but I ordered at 10 AM and had the item by 5 PM.

Re:Seen this before...

[DogDude]

It's pretty simple. They'll continue losing money until their stock price stops going up. Nobody really cares whether they're profitable or not.

Re:Seen this before...

[Sprouticus]

Or they have lots of deliveries and can optimize. It is not that complex.

Sure there will be times where you are the only person and they lose money on gas and driver time. And there will be times where they have 2 dozen deliveries and the gas for your piece costs $0.15

The trick is to make the delivery coverage area the right size to account for the volume of orders.

Re:Seen this before...

[mdielmann]

You've clearly never been in a warehouse. Buy whatever you want. Your order will be packaged up in an efficient size for transportation (sub-packaged for easy carrying into your house), put in a truck selected for the load to be carried with the coverage to deliver it to your door in a reasonable timeframe, and the truck will probably spend 10 minutes at each stop. More users will only make it more efficient. Less variety will only have a slight benefit to making it more efficient, and only if they want you to spend the money for those items that they choose not to carry elsewhere. Because Amazon is all about the limited selection.

same day? big deal!

[Cyko_01]

I can order a freshly made pizza and have it within the hour! I'm not about to sit around all day waiting for my groceries to show up.

Re:same day? big deal!

[oodaloop]

But what if you order a DiGiorno frozen pizza from a supermarket, and they deliver it to you? Oh man, I just blew my mind!

Done something like this

[DeathToBill]

Grocery delivery has been pretty common in the UK for a while. I used it for a couple of years. It's not same-day. You order what you want online then book a delivery slot and someone comes around within about a 90 minute window with your groceries.

The good thing about it is you can get all your groceries delivered without having to leave your home. Some of the websites are getting pretty good now - you can set up lists of things that you always order and that get added to your list automatically and so on. The main downside is what happens when they don't have what you asked for in stock. They'll substitute something else. It's up to you to check the receipt when the delivery comes and see if they've substituted anything - if you can remember what you ordered in the first place. They make some pretty bizarre substitutions. I remember ordering 5kg of potatoes. They didn't have the specific 5kg bag I asked for so they substituted a tray of four small potatoes. Um.

Geek me to the max

[JackSpratts]

Written like a true geekster. Look, shopping isn't particularly about distribution...that may indeed be what selling is about (although I doubt it), but shopping is a whole nuther animal. When I'm stuck behind my tesla 19" wonderwindow for hours, I often lunge at any excuse to get out of the home office. If that means heading to Trader Joes for some fresh ciabatta bread (squeezed by me to be sure) or a taste of that new sauce the nice lady hands me I'm winning on two levels. I'm out of the house and in control of buying and perusing. Bumping into somebody cute is icing on the cake. I can't do any of that from my desk. Certainly for many commodities online shopping has real merit, and it's possible that by chipping away at the margins Amazon may render less enlightened establishments vulnerable, but the breathless prose of the writer is more wishful thinking than anything truly predictive.

See this is the thing...

[jafiwam]

the fools that want to enforce local taxes on out of state Internet purchases don't understand.

Amazon and a couple other large Internet retailers, are on the virge of, and WANT TO compete locally like this.

The difference, at this point, in their costs is hovering around the difference between the local taxes and the "out of state" places they sell.

Once that difference is wiped out, there will be six or seven Amazon distribution centers in every state and they'll be doing next day or same day service on almost all purchases, and will be able to deliver 50 different types of lettuce faster than you can drive around town to purchase three. When there's a professional driver with a route to worry about transpiration, the thing coming from the next county over is nto a big deal whereas the household errand runner can't or won't go that far.

Not to mention non-perishable stuff like DVDs, books, small appliances, tools, grains and dry "grocery" goods. They won't care if a TV sits on a shelf for a month while a local retailer does. Heck, I buy a lot of grains, crackers, household cleaners, paper products, etc. on Amazon now just because I am often thinking of it when I am at work (in front of a computer) and forget when I go to get a salad from the grocery store.

The retailers crying about unfair competition have no idea what is about to hit them. The "tax the out of state purchase" push will absolutely kill a bunch of retailer types. They'll hold on for a few years while the luddites die out, but Best Buy being "Amazon's showroom" will spread to every other non convenience store / fast food type local operation or people will just learn to do their research online. (Also note, once the threshold is reached, there will be so much reviewing going on that making a decision will be easy and reliable. Going to talk to the salesweasel and finger-fuck the thing won't need to happen.