AirTalk for July 13, 2012

Amazon wants to offer instant gratification, in the form of same day shipping

Amazon Warehouse Employees Prepare For Their Busiest Time Of Year

Matt Cardy/Getty Images

The Amazon Swansea fulfilment centre in Swansea, Wales.

Shopping online versus in a retail store has always been an either-or proposition; either you pay a little more to get it now, or you pay a little less and wait for it to show up. Now, Amazon.com may have the solution.

For the last several years, online retailers had the price advantage over the brick and mortar businesses because of the state sales tax. If you owned a shop you had to impose the tax, but if you didn’t have a storefront in that state, the onus of paying the tax was on the consumer in the form of a use tax. Until recently, Amazon fought off mounting pressure by state and local governments to impose state sales taxes. A sudden shift in practices has Amazon collecting sales tax in six states with another five to be added soon.

So why would they give up their decided advantage? The answer is storefronts—or—more to the point, distribution hubs. With a massive infrastructure of distributors, Amazon would now be poised to get your products on your doorstop hours after you’ve ordered them. Talk about instant gratification.

So, what would same-day shipping, Amazon-style, mean for local businesses? Would you shop online more often if you could get your product on the same day? Is this any different than a big-box store moving into town?

GUESTS

Barney Jopson, US retail correspondent for the Financial Times.


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