Case Study Of Amazon’S Cashier-Free Stores And Its Operations

Introduction

The topic of this case study is about Amazon’s Cashier-Free Stores and its operations in the economic standpoint. This case study is provided to give the reader information on company’s factors of production, positive and normative statements and rational choice of shopping at this e-commerce giant. With this given the reader should find it easier to understand what it’s like shop in the Amazon Go store without leaving the country. The information presented in this case study came from a variety of sources such as, video blogs, news report, and technology articles.

Factors of Production:

Land Amazon Go’s natural resources are very limited. In this case, the ‘gifts of nature’ are the fresh foods that is prepared in the store. It is mainly their salads and sandwiches that makes up the ‘land’. List to include, to name a few, are:

• Water that they use to wash the food and perhaps, to clean their store
• Natural gas for heating the store· If any, fish that is used to make a sandwich, and/or ready to go take out meal
• Vegetables, including ingredients in a salad and or sandwich such as cabbage and lettuce

Labour

Since it is dubbed as ‘cashier-free store’, this means fewer labourers are needed (Sebastian, 2018). In fact, the e-commerce giant only needs 3 to a maximum of 10 workers, averaging of 6 employees working on site per store location (Statt, 2017). Cutting a job position(s) in the company in replacement of modern technology reduces the labour they have to pay, making it cost-effective for the company and keeping more profit. Amazon Go’s employees are divided into 3 categories of job position: management, logistics, and retail associates (Amazon Jobs, n. d. ).

• Management: They are responsible for directing employees how to do their job well and efficiently. They also do any accounting work such as calculating and tracking revenue and payroll.
• Logistics: They are responsible for the inventory the store has, to refill and put items in their designated shelves. In addition, they could be working overnight to stock items.
• Retail Associates: They are responsible for assisting customers, from greeting them as they walk in to meal preparation, and even doing janitorial duties. Job positions including, but not limited to are food meal prep and/or cook, greeter, and alcohol identification checker. Capital Amazon Go’s combination of state-of-the-art technology with their special camera boasts the most advanced machine learning, computer vision and artificial intelligence that is similar to self-driving cars (Amazon, 2016).
• Innovative Technology: It is obvious that it is their “Just Walk Out Technology” that makes Amazon Go Stores look futuristic (Amazon, 2016).
• Machines: To get inside, you have to pass their QR (Quick Response) code machine by logging in to your Amazon account. In addition, there are plenty of cameras on the roof and in the shelves to track people’s buying decisions inside the store.
• Tools and Instruments: In preparation for food, it is relatively same tools they use as what you see in some sandwiches and salad shops (i. e. knives, chopping boards, etc. ).
• Buildings: The first Amazon Go ever built is in Seattle, Washington, nearby its headquarters. It is the same size as the ‘neighbourhood convenience store’ (Sebastian, 2018). Amazon has announced their plans opening up more Go stores in Chicago and San Francisco (Wiggers, 2018). EntrepreneurshipJeff Bezos is the Chief Executive Officer of Amazon (Snider, 2018). Besides employing managers, logistics, and retail associates, Amazon Go also has engineers (software development, electrical, mechanical, etc. ) working through the technology to bring the newly automated brick-and-mortar store, making it unique to the public. However, their engineers don’t really work on site. Instead, the engineers and Bezos created the idea of new shopping experience, making once a concept real and now available and running. Before the Go stores opened, it was initially a beta and only Amazon employees could try it out before opening to the public (Reuters, 2018).

Types of Statements

Examples of Positive Statements· “Then, the rest is like magic. You simply take what you want to purchase from off the shelves and put it in your bag (Wong, 2018). ”It took at least 2 years to build the technology and it is Amazon’s goal on futuristic shopping experience. They had to do a trial and error and made adjustments (Daniels, 2016). They made sure it will definitely work for the public. They had to hire skilled engineers to bring the idea to life. It also takes time to get your receipt once you walked out from the store. It is not magic.

• “All of these brick-and-mortar trials aim to do generally the same thing–take out the pesky human interaction involved with shopping (Guthrie Weissman, 2018). ”It will only get rid of cashier positions, if Amazon is successful to do so. However, it might take a long time. To build such an expensive technology means that only bigger cities will only have the state-of-the-art technology. The company still needs people to restock the items to their shelves.
• “Amazon Go will be more of a threat to fast-casual restaurants if it is targeting cities, said Jeff Lenard, vice president of NACS (Chicago Business, 2018). ”Amazon Go Stores will not be a threat to restaurants as there is only a limited selection of ready to go meals. Unlike in restaurants, you also can’t customize food in the Go stores because it is already ready made wrapped and/or already on the container. Examples of Normative Statements· “The Information’s report goes on to offer the reminder that the technology behind the concept could eventually completely transform the physical retail experience, “with the potential to eliminate millions of cashier jobs” (Meek, 2018). ”It will not eliminate millions of cashier jobs. It will only reduce the amount of cashier job postings in the future. Remember, some neighbourhood convenience stores are family business owned. These small businesses might not want to adapt the model that Amazon has as it will cost them fortune and potentially, not get their money back.
• As an avid Amazon online shopper, I will not go to their grab-and-go smart store because it reduces the items I can choose. I like variety and trying new things. I also don’t like the fact that cashier jobs are taken away (Janzen, K. Personal communication, 2018)It will be hard for some people without any qualifications to look for jobs. In addition, some people might not be willing to try to experience Go stores because they have certain preferences for products. If their preferred product is not available in the Go shelves, they look somewhere else. Is shopping at Amazon Go a rational choice? It is not a rational choice for me to shop at Amazon Go stores. There will be less human interaction which I don’t like. If Amazon Go expands further, I believe that people will take advantage of their “Just Walk Out Technology” and shoplifting rates will go up. It is easy to remove an item you intentionally bought from your virtual receipt, and you can keep the product at the same time, thus making it free (Sebastian, 2018). I don’t condone stealing at all. In addition, newer technology costs a lot of money to build and operate, and I believe that by hiring someone to do the customer’s work, is very cheap labour that I support.

Furthermore, it cuts the low entry level jobs that my potential children can get as their part time job while attending school. To be a cashier, you don’t need a high school diploma or a degree to do the work. It only requires you to be familiar with the machine and till system. I also don’t like how the future of shopping will soon be replaced by robots and machine to do the work as I believe it is not always perfect and I can’t get exactly what I want because I am really picky at certain things.