Ever wondered how Amazon really works? The linked article gives you an insider’s look at all the moving pieces that work together to let you buy practically anything you’d ever want.
Shoppers take for granted that Amazon will have what they want. The only time they notice is when Amazon doesn’t. “The biggest failure you can have is not to have what they’re looking for,” says Scot Wingo, CEO of ChannelAdvisor, which makes cloud-based software for third-party sellers to analyze their sales and marketing campaigns on Amazon, eBay, Google, and elsewhere.
Starting in 2006, the rate of Amazon’s sales growth took off, an upswing Wingo credits to the launch of unlimited 2-day shipping through Amazon Prime the previous year alongside the rise of the company’s third-party marketplaces. The arrival of third-party sellers fueled an “explosion in selection,” Wingo says, that also gave Amazon a powerful way to hedge the risk of stocking products too far out along the long tail of marginal popularity. Instead of sinking its own money into inventory that might sit for 60 days, Amazon could let someone else fill in that gap.
Lest you think this is merely a puff piece:
Such power and speed can come at a grave price. Amazon is facing a federal investigation into the death of a worker at a Pennsylvania fulfillment center who was reportedly struck and pinned by a pallet jack she was operating. Much has also been written about how the unrelenting nature of Amazon’s fulfillment system can foster exploitive, sometimes hazardous working conditions that have become the target of at least one set of class-action lawsuits.