Tuesday, 30 October 2007

The thing about Amazon

I love just about everything about Amazon. Sure, lots of sites now do good e-commerce, but Amazon were so ahead of their time when they launched, and most people are still a long way from catching up.

One of the few things I do worry about with Amazon, however, is the amount of packaging they use - its just not very environmentally friendly, is it?

However, a friend described to me the other day how they saw the delivery man through the window as he dropped their Amazon delivery. Of course, the delivery man flat denied it! But as it turned out, the item was so over-packaged that it was completely unscathed after the drop. So perhaps over-packaging makes sense after all.

What are the take-outs from this? Well, we need to sort out two problems in the physical goods e-commerce space:
1. No matter how sophisticated our fulfillment systems are, at the end of the chain is the good old delivery driver. Economies of scale suggest that businesses will always be under pressure to use less skilled, less expensive delivery drivers who take less care over the product. It seems that the last mile is the weak chain in the link.
2. Sooner or later, the physical goods e-commerce industry is going to have to face up to the environmentalists regarding the environmental costs of individual delivery and over-packaging of items. This is unlikely to be a friendly discussion.