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How Amazon Can Make You Rich

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Amazon is expanding its home delivery grocery service to Los Angeles after six years of operation in Seattle. This expansion, the first of many expected to come, marks a significant step forward for online shopping. We’ve already discussed how the growth of home delivery services like this can save people time and money while reducing emissions and greening the economy. But there’s another crucial benefit: When big companies like Amazon lead service delivery innovation, they create openings for entrepreneurs. The WSJ reports on how small businesses have piggybacked on Amazon’s success:

Chris Porter, owner of A La Mode Pies in Seattle, said he was selling more Mexican chocolate mousse and strawberry rhubarb confections thanks to an AmazonFresh program offering delivery of prepared foods from restaurants, bakeries and other small businesses. “It’s been great for my business,” said Mr. Porter, 40, adding that he was considering opening another storefront in the Seattle area.

It’s commonly assumed that big business always crowds out small business. Big grocery stores drive out mom and pop corner stores; Borders and Barnes & Noble drive out small bookstores. But this is only half the story. A La Mode Pies shows that in the new service economy big and small business can work together symbiotically.

This is particularly true when it comes to the tech industry. Smart small businesses offering boutique services will be able to use the platforms like Amazon’s to sell their wares to a wider customer base.

This is doubly important because the future of American economy will see a significant increase in the number of service jobs. We are reaching a point where fewer and fewer people are needed to provide us with our basic necessities; the jobs that will be most valuable in the future are those that provide people with experiences they desire after basic needs are met. Both big and small businesses will play an important role in this transition.

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  • wigwag

    This is a great story. It’s terrific to see that Via Meadia is on top of this trend. Amazon is doing what it does best; in this case disintermediating the supermarket business while interposing itself as a more nimble and efficient value added intermediary. The idea of expanding the relationship between botique producers and Amazon that Via Meadia highlights in this post is exciting.

    One great example of disintermediation that doesn’t get too much press attention is community supported agriculture and the expanding universe of farmers markets. Both bring down costs while providing incremental value.

    Community supported agriculture provides an opportunity for small family farmers to contract directly with small groups of consumers to sell their produce, eggs, dairy products, meat, etc. The trend is now extending to fishermen. Farmers markets allow farmers to bypass the traditional supply chain and offer their products directly to consumers. There are great farmers markets everywhere from the mall in Santa Monica to Union Square in Manhattan. One of my favorites is in Jackson Heights, the lovely community where Professor Mead resides.

    A continuing challenge for both community supported agriculture and farmers markets is transporting the food they produce in rural communities to their customers in urban and suburban communities. It is easy to picture how Amazon or other value added intermediaries could add value to this relationship for both the producers and the consumers.

  • bigfire

    Interesting. Los Angeles is one of the most geographically dispersed city in the country. If they can make it work here, they can really make it work elsewhere.

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