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It's a trap. You, owner of a shop, don't do this. Amazon will first analyze all your sales data, they will than attach reviews to your shop and finally they wi

It's a trap. You, owner of a shop, don't do this. Amazon will first analyze all your sales data, they will than attach reviews to your shop and finally they will oblige you to play by their rules or die (banned or killed by bad reviews) and either way they will grow thanks to your hard work. I'm not joking, this is exactly what they have done (and keep doing) with "partners". Amazon is all but transparent and it has been growing like crazy during the last 6-8 years thanks to this exact strategy. Online is not enough anymore, they need to conquer local stores as well. The empire strikes back.

itry 12y ago
> they will than attach reviews to your shop They will come and stick reviews on your window or what?
- jnardiello 12y ago
  How they will implement reviews for local shops is speculation at this point, but yes. They will allow reviews for local shops and use them to influence buyers choosing where to cut their hairs or where to buy the best cakes.
antr 12y ago
I get your comment and agree with it, but... It's funny how us (the HN/startup/pro disruptive audience) is very pro change (let's get rid off the middle man because we can create software that can do this cheaper and more efficient) and now we are 'rooting' for the brick and mortar business. There is a sociological take away somewhere here.
- clamprecht 12y ago
  Change can be good, but it also matters who is "running" the change.
- gdulli 12y ago
  Some change/progress is good and some is bad and that doesn't seem like a subtle point. I don't know how anyone gets into the mindset of assuming change is inherently good or inherently bad.
- gummywormsyum 12y ago
  People welcome change, but they're also weary of too much market power with any one player (see Comcast as an example)
  - beobab 12y ago
    Do you mean weary or wary? I can see that it might easily be both, though...
    - gummywormsyum 12y ago
      Oh I meant wary (I'd missed the distinction between those two words until now), thanks!
- epistasis 12y ago
  Amazon is a middleman too, just one that does lots of online shipping. If they become the only middleman, than the situation gets much worse as there are no longer any market forces to keep Amazon's prices to be close to their costs. The only force at that point is Amazon's good will to not make a profit.
  - totalrobe 12y ago
    Don't worry. Amazon isn't even the biggest middleman: "Last year, combined total volume of merchandise handled by Taobao and Tmall surpassed 1 trillion yuan, or about $160 billion, according to Alibaba. That figure was larger than Amazon’s $86 billion, according to RetailNet Group, or eBay’s 67.8 billion"
- macNchz 12y ago
  While I'm for technological progress, I prefer to live in an environment where small entrepreneurs can thrive, which requires me to be skeptical when a giant, borderline-monopolistic company comes along with 'new technology' that's true purpose appears to be to subvert small business owners and take their customers.
  - res0nat0r 12y ago
    Wasn't Amazon exactly this for many years?
    - XorNot 12y ago
      You don't get to be the underdog forever. There was a very long period there where people hadn't realized that Apple wasn't the struggling underdog vs. Microsoft anymore as well. Monopolies are bad, and since all the people on HN are the small business owner (or want to be soon), making people aware of what's going to happen is kind of important. It's also not new: there are players trying to do this type of thing in every industry. You even see it in medicine.
bkeroack 12y ago
I agree with the sentiment, but it's more about the data. Amazon wants brick and mortal sales/pricing information so they can undercut you more effectively. They'll probably bundle in some service where you get an online store for cheap/free, which makes you even more dependent on them for inventory management as well. At that point Amazon controls your cashflow and your products and--in a sense--owns your business.
- opendais 12y ago
  Yes, its this. Its also what Amazon does to its drop ship companies if they don't manufacture their own products. ;) ITS A TRAP! :P
- jnardiello 12y ago
  Yes. And just to add another evilish detail: Controlling your cashflow means also that you are effectively borrowing them 2+ weeks of your income (as far as they will pay you with recurrent wires AFTER you have sold your stuff) at no cost. On a very low level, this is the mechanism that allowed them to survive for years without making profit on their products.
  - totalrobe 12y ago
    Why do you say Amazon is controlling cashflow? It looks like they offer bank transfers everyday. From the site: "Fast, reliable deposits. Deposits to your bank account the next business day. Or spend your money at Amazon.com within minutes."
    - cbhl 12y ago
      Because that's not how long it takes for money to really clear a credit card when banks are involved.
      - totalrobe 12y ago
        Well then one business day would be an improvement on cash flow vs a typical bank... or am I an idiot? Obviously it's hard to compete with Amazon on commodity products, but it seems like they are lowering the barriers to entry for many unique retailers and small businesses.
taeric 12y ago
Who actually reads reviews of "partner" shops on Amazon? Don't get me wrong, I give out 5 stars for every one I deal with. Mostly because I rarely realize I dealt with them. Things arrive on time and as advertised. Does this not happen regularly for some folks?
- adventured 12y ago
  I automatically check who I'm buying a product from on Amazon, and look at their ratings. It started for me years ago when I noticed it becoming ever more common that products were coming from other parties than Amazon, and also for Prime purposes. I'll often balance price against rating; if something costs $X, I'll pay $X more to buy from a very highly regarded supplier vs. one that isn't. That said, I'm not sure I was aware there are actual reviews. I just check the scorecard.
adamt 12y ago
I think the compelling case for this is less about shops - most of which (at least in the UK) already have some form card processing - but more about things like tradespeople (plumbers, decorators, electricians etc) or other physical services (e.g. music teachers) Within a few years cheques will be phased out in the UK. This means the only way to pay a carpenter, or a plumber is in cash or a money transfer. Money transfers to new suppliers always take a bit of faff to setup, and a card payment like this would often be easier.
- andyjohnson0 12y ago
  Cheques are not being phased-out in the UK. From the government FAQ [1] published in 2011: Are cheques being phased out? No. The Payments Council announced on 12 July 2011 that cheques will continue for as long as customers need them. A previously announced target for closing the cheque clearing system by 2018 has been cancelled. [1] https://www.gov.uk/government/news/frequently-asked-questions-on-the-closure-of-the-cheque-system https://www.gov.uk/government/news/frequently-asked-question...
- rahimnathwani 12y ago
  "Money transfers to new suppliers always take a bit of faff to setup" How so? If I want to send money to a UK bank account to which I've not send money before, I: 1. Open my bank's app on my phone 2. Tap 'send money' 3. Type in the amount, the 6-digit sort code, the 8-digit account number, the person's name 4. Hit 'Send'. It's a little slower than swiping a card, but it also feels safer, as I don't have to give someone physical access to my card.
  - sjtgraham 12y ago
    Who do you bank with? I bank with both Natwest and Barclays and neither of those will let you set up a new payee on their mobile apps. Sure you can send money, but only to payees you have set up online using 2FA.
    - nicholassmith 12y ago
      I think Barclays will be adding the new payee option soon to the mobile app, as they're trying to promote it as the way to do stuff. Plus they have PingIt which basically does the same thing, but is a bit of a faff for the receiver.
leccine 12y ago
Yeah, I can see the Amazon branded food truck hordes flooding the streets of San Francisco. It is kind of sad that there is not going to be any burrito or garlic noodles sold.
will_brown 12y ago
In other words Amazon is no different than the existing credit card companies (Visa, MC, AmEx, ect...), the existing merchant services, and the retailers themselves who all collect that data for purposes of selling to third parties and use for in house marketing. Brick and Mortar retailers are concerned about being able to conveniently accept payment and minimizing service charges for the convenience of accepting non-cash payment. Ideally retailers wouldn't have to accept cards, they would only accept cash, cash = no service charge by a third party. However, that is the whole point of the financial industry to create an economy that permits middle men to take a percent of every transaction (as you say "grow thanks to your hard work"). Why have a store and sell anything when you can have someone else do the work and get a % of every transaction? But Amazon is not the first to do it.
- gfodor 12y ago
  Obviously Amazon is different, because unlike credit card companies they are in the business of competing with small retailers. Particularly when you consider their "your margin is my opportunity" strategy giving this data to them should be a terrifying proposition for any business owner.
  - jack-r-abbit 12y ago
    But there are so many places that Amazon does not compete with that there is a market for this. Obviously a small book store might not want to do this but what about restaurants, coffee shops, the plumber that comes to fix your toilet (or any service industry), the local tap room, and so on. Edit: Sorry, the idea of Amazon opening restaurants, coffee shops or tap rooms (which would also mean they start brewing their own beer) reminds me of this scene from Judge Dredd: https://www.youtube.com/watch?v=xFiDoOgRTpk https://www.youtube.com/watch?v=xFiDoOgRTpk (Now All Restaurants are Taco Bell)
    - nicholassmith 12y ago
      Amazon might not be competing with them right now, but they could be in 5 years time (as ridiculous as that sounds for your examples), and businesses should take the long term view. When it was just books most businesses ignored Amazon, but they've grown to encompass many, many industries now.
runevault 12y ago
One business type I can see this making sense for is food trucks, as I don't see amazon going into that business anytime soon if ever. Beyond that I tend to agree with you that giving amazon even more data seems like a horrible idea.
- baxter001 12y ago
  A crêpe van is one of the friendly examples they have in the carousel on that page. Although why anyone would buy their decorative paper from the back of a van is beyond me.
  - phreanix 12y ago
    Don't know why you're getting downvoted, I thought it was brilliant.
- phreanix 12y ago
  Amazon has a truck fleet that look almost like Foodtrucks. I've actually seen a retrofitted Foodtruck selling Fire's and the new Amazon Phone by the beach in Santa Monica. This makes sense for more than just Foodtrucks. The pain of fees is a very real thing for retail startups and if amazon is also going to give us a terminal that can take the place of a $3k+ POS system, then I'd be seriously considering it.
colmvp 12y ago
Compare 1.75% Per Swipe (till 2016) vs. Square's 2.75%. For most small businesses, that's a huge difference.
dmachop 12y ago
Do you mean to say that Square is different in this approach? Everyone wants your data and it's the price you pay to obtain this technology.
- shliachtx 12y ago
  Square is not the biggest competition to retailers anywhere, and Amazon has a history of using the sales data of their "partners" (on Amazon.com) to compete with them.
- happywolf 12y ago
  Square is a payment processor, and does not wear the merchant hat. Even if it sells the data, the merchants acquiring the data still needs to pay, bumping up the cost of business. On the other hand, Amazon is _both_ payment processor and merchant. First it gets transaction fees (due to its volume, I guess it is paying around 1-2% for card transactions) from merchants, not a lot, but I doubt it really cares or plans to earn money from transactions. Second it gets sales analytics, and third, it can adjust its online strategies to match the trends it sees in this data. I would say #2 and #3 would be the whole point of launching this.
mk00 12y ago
Care to back up these wild claims with evidence because I've never seen this happen at Amazon.
jcomis 12y ago
How is amazon going to undercut my barber or the brewery I go to with this data? It seems like there are plenty of businesses that could benefit from this and not be at risk to the "empire".
- genericuser 12y ago
  And if they do manage to undercut your barber aren't you interested to find out how. Hair cutting drone perhaps?
  - chris_mahan 12y ago
    If they fly low enough?
- ajross 12y ago
  Exactly. All the concern trolling above is about boxed product retail, where you're "competing" with stuff Amazon already sells. The majority of local transactions are and have always been in the service economy where Amazon has nothing to offer. This isn't an Evil Plot, it's just an attempt to leverage their existing payment processing abilities to get themselves a piece of Square's pi, much in the same way that AWS leveraged their existing IT infrastructure. Could they mistreat retailers who are trying to make a living reselling boxed products? Yeah. But those retailers have mostly been killed off already by Big Box stores. This ship sailed long ago.
deleted 12y ago
[deleted]
waps 12y ago
This is a tragedy of the commons argument. It's a nice sentiment, but Amazon doesn't need all that many merchants to sign up to get their data, so they will get the data on your shop, whether you sign up or not. If you sign up, it's a 1.25% pay rise for 18 months ... Yes eventually technology will eat your lunch, but that's coming independant of your signing up or no.
BrandonMarc 12y ago
Makes me think of how Google Analytics is a trap. Google already knows the organic & ppc traffic it sends you, but if you get plugged in to Analytics (or AdSense, for that matter), then Google gets to see what organic & ppc traffic comes from the other search engines, as well as other advertising, direct linking, etc. Google gets to see the whole picture of how everybody reaches your site ... sure gives the appearance of a conflict of interest, if/when they're also selling you ppc and if/when you're dependent on organic Google traffic, too.

itry 12y ago

> they will than attach reviews to your shop They will come and stick reviews on your window or what?

jnardiello 12y ago
How they will implement reviews for local shops is speculation at this point, but yes. They will allow reviews for local shops and use them to influence buyers choosing where to cut their hairs or where to buy the best cakes.

antr 12y ago

I get your comment and agree with it, but... It's funny how us (the HN/startup/pro disruptive audience) is very pro change (let's get rid off the middle man because we can create software that can do this cheaper and more efficient) and now we are 'rooting' for the brick and mortar business. There is a sociological take away somewhere here.

clamprecht 12y ago
Change can be good, but it also matters who is "running" the change.
gdulli 12y ago
Some change/progress is good and some is bad and that doesn't seem like a subtle point. I don't know how anyone gets into the mindset of assuming change is inherently good or inherently bad.
gummywormsyum 12y ago
People welcome change, but they're also weary of too much market power with any one player (see Comcast as an example)
- beobab 12y ago
  Do you mean weary or wary? I can see that it might easily be both, though...
  - gummywormsyum 12y ago
    Oh I meant wary (I'd missed the distinction between those two words until now), thanks!
epistasis 12y ago
Amazon is a middleman too, just one that does lots of online shipping. If they become the only middleman, than the situation gets much worse as there are no longer any market forces to keep Amazon's prices to be close to their costs. The only force at that point is Amazon's good will to not make a profit.
- totalrobe 12y ago
  Don't worry. Amazon isn't even the biggest middleman: "Last year, combined total volume of merchandise handled by Taobao and Tmall surpassed 1 trillion yuan, or about $160 billion, according to Alibaba. That figure was larger than Amazon’s $86 billion, according to RetailNet Group, or eBay’s 67.8 billion"
macNchz 12y ago
While I'm for technological progress, I prefer to live in an environment where small entrepreneurs can thrive, which requires me to be skeptical when a giant, borderline-monopolistic company comes along with 'new technology' that's true purpose appears to be to subvert small business owners and take their customers.
- res0nat0r 12y ago
  Wasn't Amazon exactly this for many years?
  - XorNot 12y ago
    You don't get to be the underdog forever. There was a very long period there where people hadn't realized that Apple wasn't the struggling underdog vs. Microsoft anymore as well. Monopolies are bad, and since all the people on HN are the small business owner (or want to be soon), making people aware of what's going to happen is kind of important. It's also not new: there are players trying to do this type of thing in every industry. You even see it in medicine.

bkeroack 12y ago

I agree with the sentiment, but it's more about the data. Amazon wants brick and mortal sales/pricing information so they can undercut you more effectively. They'll probably bundle in some service where you get an online store for cheap/free, which makes you even more dependent on them for inventory management as well. At that point Amazon controls your cashflow and your products and--in a sense--owns your business.

opendais 12y ago
Yes, its this. Its also what Amazon does to its drop ship companies if they don't manufacture their own products. ;) ITS A TRAP! :P
jnardiello 12y ago
Yes. And just to add another evilish detail: Controlling your cashflow means also that you are effectively borrowing them 2+ weeks of your income (as far as they will pay you with recurrent wires AFTER you have sold your stuff) at no cost. On a very low level, this is the mechanism that allowed them to survive for years without making profit on their products.
- totalrobe 12y ago
  Why do you say Amazon is controlling cashflow? It looks like they offer bank transfers everyday. From the site: "Fast, reliable deposits. Deposits to your bank account the next business day. Or spend your money at Amazon.com within minutes."
  - cbhl 12y ago
    Because that's not how long it takes for money to really clear a credit card when banks are involved.
    - totalrobe 12y ago
      Well then one business day would be an improvement on cash flow vs a typical bank... or am I an idiot? Obviously it's hard to compete with Amazon on commodity products, but it seems like they are lowering the barriers to entry for many unique retailers and small businesses.

taeric 12y ago

Who actually reads reviews of "partner" shops on Amazon? Don't get me wrong, I give out 5 stars for every one I deal with. Mostly because I rarely realize I dealt with them. Things arrive on time and as advertised. Does this not happen regularly for some folks?

adventured 12y ago
I automatically check who I'm buying a product from on Amazon, and look at their ratings. It started for me years ago when I noticed it becoming ever more common that products were coming from other parties than Amazon, and also for Prime purposes. I'll often balance price against rating; if something costs $X, I'll pay $X more to buy from a very highly regarded supplier vs. one that isn't. That said, I'm not sure I was aware there are actual reviews. I just check the scorecard.

adamt 12y ago

I think the compelling case for this is less about shops - most of which (at least in the UK) already have some form card processing - but more about things like tradespeople (plumbers, decorators, electricians etc) or other physical services (e.g. music teachers) Within a few years cheques will be phased out in the UK. This means the only way to pay a carpenter, or a plumber is in cash or a money transfer. Money transfers to new suppliers always take a bit of faff to setup, and a card payment like this would often be easier.

andyjohnson0 12y ago
Cheques are not being phased-out in the UK. From the government FAQ [1] published in 2011: Are cheques being phased out? No. The Payments Council announced on 12 July 2011 that cheques will continue for as long as customers need them. A previously announced target for closing the cheque clearing system by 2018 has been cancelled. [1] https://www.gov.uk/government/news/frequently-asked-questions-on-the-closure-of-the-cheque-system https://www.gov.uk/government/news/frequently-asked-question...
rahimnathwani 12y ago
"Money transfers to new suppliers always take a bit of faff to setup" How so? If I want to send money to a UK bank account to which I've not send money before, I: 1. Open my bank's app on my phone 2. Tap 'send money' 3. Type in the amount, the 6-digit sort code, the 8-digit account number, the person's name 4. Hit 'Send'. It's a little slower than swiping a card, but it also feels safer, as I don't have to give someone physical access to my card.
- sjtgraham 12y ago
  Who do you bank with? I bank with both Natwest and Barclays and neither of those will let you set up a new payee on their mobile apps. Sure you can send money, but only to payees you have set up online using 2FA.
  - nicholassmith 12y ago
    I think Barclays will be adding the new payee option soon to the mobile app, as they're trying to promote it as the way to do stuff. Plus they have PingIt which basically does the same thing, but is a bit of a faff for the receiver.

leccine 12y ago

Yeah, I can see the Amazon branded food truck hordes flooding the streets of San Francisco. It is kind of sad that there is not going to be any burrito or garlic noodles sold.

will_brown 12y ago

In other words Amazon is no different than the existing credit card companies (Visa, MC, AmEx, ect...), the existing merchant services, and the retailers themselves who all collect that data for purposes of selling to third parties and use for in house marketing. Brick and Mortar retailers are concerned about being able to conveniently accept payment and minimizing service charges for the convenience of accepting non-cash payment. Ideally retailers wouldn't have to accept cards, they would only accept cash, cash = no service charge by a third party. However, that is the whole point of the financial industry to create an economy that permits middle men to take a percent of every transaction (as you say "grow thanks to your hard work"). Why have a store and sell anything when you can have someone else do the work and get a % of every transaction? But Amazon is not the first to do it.

gfodor 12y ago
Obviously Amazon is different, because unlike credit card companies they are in the business of competing with small retailers. Particularly when you consider their "your margin is my opportunity" strategy giving this data to them should be a terrifying proposition for any business owner.
- jack-r-abbit 12y ago
  But there are so many places that Amazon does not compete with that there is a market for this. Obviously a small book store might not want to do this but what about restaurants, coffee shops, the plumber that comes to fix your toilet (or any service industry), the local tap room, and so on. Edit: Sorry, the idea of Amazon opening restaurants, coffee shops or tap rooms (which would also mean they start brewing their own beer) reminds me of this scene from Judge Dredd: https://www.youtube.com/watch?v=xFiDoOgRTpk https://www.youtube.com/watch?v=xFiDoOgRTpk (Now All Restaurants are Taco Bell)
  - nicholassmith 12y ago
    Amazon might not be competing with them right now, but they could be in 5 years time (as ridiculous as that sounds for your examples), and businesses should take the long term view. When it was just books most businesses ignored Amazon, but they've grown to encompass many, many industries now.

runevault 12y ago

One business type I can see this making sense for is food trucks, as I don't see amazon going into that business anytime soon if ever. Beyond that I tend to agree with you that giving amazon even more data seems like a horrible idea.

baxter001 12y ago
A crêpe van is one of the friendly examples they have in the carousel on that page. Although why anyone would buy their decorative paper from the back of a van is beyond me.
- phreanix 12y ago
  Don't know why you're getting downvoted, I thought it was brilliant.
phreanix 12y ago
Amazon has a truck fleet that look almost like Foodtrucks. I've actually seen a retrofitted Foodtruck selling Fire's and the new Amazon Phone by the beach in Santa Monica. This makes sense for more than just Foodtrucks. The pain of fees is a very real thing for retail startups and if amazon is also going to give us a terminal that can take the place of a $3k+ POS system, then I'd be seriously considering it.

colmvp 12y ago

Compare 1.75% Per Swipe (till 2016) vs. Square's 2.75%. For most small businesses, that's a huge difference.

dmachop 12y ago

Do you mean to say that Square is different in this approach? Everyone wants your data and it's the price you pay to obtain this technology.

shliachtx 12y ago
Square is not the biggest competition to retailers anywhere, and Amazon has a history of using the sales data of their "partners" (on Amazon.com) to compete with them.
happywolf 12y ago
Square is a payment processor, and does not wear the merchant hat. Even if it sells the data, the merchants acquiring the data still needs to pay, bumping up the cost of business. On the other hand, Amazon is _both_ payment processor and merchant. First it gets transaction fees (due to its volume, I guess it is paying around 1-2% for card transactions) from merchants, not a lot, but I doubt it really cares or plans to earn money from transactions. Second it gets sales analytics, and third, it can adjust its online strategies to match the trends it sees in this data. I would say #2 and #3 would be the whole point of launching this.

mk00 12y ago

Care to back up these wild claims with evidence because I've never seen this happen at Amazon.

jcomis 12y ago

How is amazon going to undercut my barber or the brewery I go to with this data? It seems like there are plenty of businesses that could benefit from this and not be at risk to the "empire".

genericuser 12y ago
And if they do manage to undercut your barber aren't you interested to find out how. Hair cutting drone perhaps?
- chris_mahan 12y ago
  If they fly low enough?
ajross 12y ago
Exactly. All the concern trolling above is about boxed product retail, where you're "competing" with stuff Amazon already sells. The majority of local transactions are and have always been in the service economy where Amazon has nothing to offer. This isn't an Evil Plot, it's just an attempt to leverage their existing payment processing abilities to get themselves a piece of Square's pi, much in the same way that AWS leveraged their existing IT infrastructure. Could they mistreat retailers who are trying to make a living reselling boxed products? Yeah. But those retailers have mostly been killed off already by Big Box stores. This ship sailed long ago.

deleted 12y ago

[deleted]

waps 12y ago

This is a tragedy of the commons argument. It's a nice sentiment, but Amazon doesn't need all that many merchants to sign up to get their data, so they will get the data on your shop, whether you sign up or not. If you sign up, it's a 1.25% pay rise for 18 months ... Yes eventually technology will eat your lunch, but that's coming independant of your signing up or no.

BrandonMarc 12y ago

Makes me think of how Google Analytics is a trap. Google already knows the organic & ppc traffic it sends you, but if you get plugged in to Analytics (or AdSense, for that matter), then Google gets to see what organic & ppc traffic comes from the other search engines, as well as other advertising, direct linking, etc. Google gets to see the whole picture of how everybody reaches your site ... sure gives the appearance of a conflict of interest, if/when they're also selling you ppc and if/when you're dependent on organic Google traffic, too.