Amazon this week announced the next chapter in its bid to rule the commercial world. The company is looking to create a network of independent delivery fleets, and it wants “hundreds of entrepreneurs” to “start businesses” in support of this.
This represents a major move in the logistics realm, one that will see Amazon go up against long-established players — such as Fedex and UPS — and which has been rumored for a while.
But the language Amazon is using to attract prospective business owners is also notable. The company’s pitch appeals to America’s entrepreneurial spirit while obfuscating the reality of what signing up to the program really means.
It’s difficult to overstate Amazon’s commercial clout. The Seattle-based company claimed around 44 percent of online sales in the U.S. alone last year, according to reports. And with its Whole Foods acquisition, Amazon is making inroads into the brick-and-mortar world. In fact, it has done a stellar job of creating a gargantuan ecosystem of products and platforms to hook users and keep them coming back. And this growing demand is precisely why the company now wants to build out its own logistics network for “last mile” deliveries.
Amazon is underplaying its logistics expansion and largely positioning this as a complementary program intended to round out existing delivery services and help it keep up with demand. But then it has to do that because it still needs its logistics partners — for the time being, at least.
“We have great partners in our traditional carriers, and it’s exciting to continue to see the logistics industry grow,” explained Dave Clark, Amazon’s senior vice president of worldwide operations. “Customer demand is higher than ever, and we have a need to build more capacity.”
Amazon is no stranger to running logistics services. It has been operating its Flexpeer-to-peer (P2P) delivery program for a while, effectively letting anyone who owns a car become a courier for a day, a week, or forever — a little like Uber.
As with many other gig-economy platforms, reports suggest that Flex is not all fun — in fact, it’s a lot of effort for not a huge return. Plus, it offers no perks, benefits, or job security. The rates of pay and working landscape vary depending on factors such as where you are based, but the core selling point is consistent: “Be your own boss” is Amazon’s persistent marketing mantra.
And this is a thread we see permeating the gig economy. Big companies need workers — but they want to avoid the commitment of maintaining a traditional workforce, such as offering salaries, medical insurance, paid time off, and so on. One key to sustaining this charade lies in calling their typically low-paid workers “entrepreneurs.”
Uber has referred to its drivers as entrepreneurs for years, despite reports that they earn very little after expenses. Alongside other carefully constructed terminology, such as “partner drivers,” casting freelance gigs as “entrepreneurship” is part of Uber’s plan to make its workforce feel empowered. But it doesn’t paint the whole picture — a New York Times report last yearreferenced an internal Uber slide deck on driver income levels that revealed the company considered its main rivals for attracting new drivers to be McDonald’s and Lyft.
Under the guidance of new CEO Dara Khosrowshahi, Uber is taking steps to improve a reputation that has been tarnished by a series of scandals and feuding at the highest levels. In Europe, where workers tend to expect benefits and job protections, Uber is now offering drivers free insurance for illness, jury service pay, paid maternity/paternity leave, and more. This positions Uber more as an employer, despite a great deal of legal wrangling over the term, and is surely a tacit acknowledgment that drivers have been struggling to make ends meet.
A Brown University case study from a few years ago delved into the “entrepreneurial aspects” of Uber’s driver model. Patrick McQuown, an adjunct lecturer at Brown’s School of Engineering, actually spent the summer driving for the company, logging 400 hours and 8,000 miles in the process. His conclusion? The Uber driver model is not particularly entrepreneurial, and top-rated drivers receive no meaningful recognition for their efforts.
“Entrepreneurship means that you create a product or service that’s unique in the marketplace, and you’re rewarded with more profit,” McQuown said. “You simply can’t do that as an Uber driver. There’s no real chance to differentiate yourself financially from other Uber drivers.”
Read more at https://venturebeat.com/2018/06/29/the-future-of-entrepreneurship-working-for-amazon-and-uber/. Article courtesy of venturebeat.com