Top Reasons Why Amazon Prime Could Destroy Your Business

Amazon Prime has been a game-changer for retail. It is now an established and well-known platform that millions of people use regularly. Amazon Prime has been able to change the way people shop, and it has caused many retailers to close their doors. The service offers consumers a variety of benefits, including free two-day shipping, access to Amazon’s library of movies, TV shows, books, and music, unlimited photo storage, and more. The membership costs $119 per year or $12.99 per month.

With all these benefits Amazon Prime offers, it is easy to see why so many consumers turn to the service as their go-to option for shopping online. Such consumer behavior has impacted businesses, both medium and small, negatively.

Get Ready for the Amazon Prime-pocalypse, because it’s already here

With the launch of Prime, Amazon has created a new market for itself. A perfect blue ocean strategy, so to speak. It is now competing for head-on with retailers like Walmart and Target. Even the biggies like Walmart have started their customer loyalty program. But it is yet to catch on and come up the curve to Amazon Prime. So Prime virtually has no competition!

Why is Amazon Prime Such a Threat to Small Retailers?

With the introduction of Amazon Prime, it is no longer necessary to go to a store and buy everyday items. Instead, customers can order items online and have them delivered right to their doorsteps. The convenience of this service has made it popular with consumers and has already caused some brick-and-mortar stores to close.

Amazon Prime’s success is largely because it offers customers many benefits that they don’t get from other retailers. Especially small retailers who struggle on maintaining margins to keep their stores running. Amazon Prime guarantees free two-day shipping on most products and provides access to streaming services like Amazon Video, Music Unlimited, Kindle Unlimited, etc., for free.

Why does Amazon Prime destroy products?

Amazon Prime offers two-day shipping on millions of eligible items. However, Amazon has been reported to have destroyed millions of unsold products in a warehouse in the US. There are many reasons why this is happening. As the company deals in heavy volumes, items may be damaged or defective. However, the company states that items are destroyed because of its strict quality policy enforced at its fulfillment centers.

The main reason seems that the company has to stock heavily due to Prime’s short delivery time, and most items remain unsold. Who bears the loss for unsold items? Amazon? Wrong guess! It is the sellers!

Amazon Prime is Destroying Warehousing Jobs in the US

Amazon Prime has been a game-changer in the retail industry. It is the fastest growing business in the US and one of the most profitable businesses in history. It has made shopping easier, faster, and cheaper for consumers. But how does it affect jobs?

Amazon Prime’s business model is based on low prices and free shipping, so they have to cut costs wherever they can. This includes reducing labor costs by using automation instead of humans to do tasks that are not customer-facing such as warehouse operations, driving deliveries to customers’ homes, or picking items off shelves to fulfill orders. And future only sees more automation as robots from Amazon Robotics aggressively take over work from humans.

Amazon Prime Is Making Us Less Productive And Less Creative

Amazon Prime has made users more reliant on its services. It also means that the service has created a culture of instant gratification. Consumers are getting used to the idea of getting all kinds of products delivered in a maximum of two days. It translates to fewer visits to the stores reducing the buying effort. They do not have to walk to or drive to the store, and money can now flow easily out of their wallets. No cash is involved now, card-swiping is virtual. Consumers don’t experience paying for a product or service. Thereby making consumers more reliant on Amazon Prime’s services. The new culture of instant gratification also affects consumer creativity and productivity levels. Some studies have shown that people who use the internet for shopping or entertainment tend to be less creative.