The Everything Store—Jeff Bezo and the Age of Amazon by Brad Stone ; Published by Tranworld Publishers ; Pages 464; Price Rs,499/---
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Jeff Bezos is the man who turned a crazy-at-the-time idea to sell books over the Internet into a $ 1.67 trillion behemoth.
Bezos announced recently that he will step down as CEO of Amazon. His move will enable him to spend more time on other interests and find ways to spend a personal fortune that thanks to Amazon's booming stock price is now about 195 billion.
Bezos is called The Gilded Age Moghul. What makes Bezos tick is graphically revealed in the book under review written by Brad Stone.
It is the definitive story of Amazon.com, one of the most successful companies in the world, and of its driver, brilliant founder, Jeff Bezos.
Amazon.com began by delivering books through the mail. But the visionary founder, was not happy with being a mere bookseller. He wanted Amazon to become the Everything Store, offering unlimited choice and attractive convenience at potentially disruptive low prices. For achieving this , he created a corporate culture of reckless ambition and utmost secrecy .
The author of the book Brad Stone was guaranteed access to current and former Amazon employees and Bezos family members, giving readers the first in-depth account of life at Amazon. Compared to competitor innovators -- Jobs, Gates, Zuckerberg -- Bezos is an essentially private man. But he rests on his restless pursuit of new markets, pushing Amazon into risky new ventures like the Kindle and cloud computing, and transforming retail in the same way Henry Ford revolutionised manufacturing. The Everything Store is the revealing, definitive biography of the company that placed one of the first and largest bets on the Internet and forever changed the way we buy and read.
In the summer of 1955, Bezos was working in a basement alongside his wife, packing paperbacks into boxes. Today, he is perhaps the 21st century's most important tycoon: one who finances space missions and newspapers for fun, and receives adulation from Warren Buffett and abuse from Donald Trump. Amazon, his firm, is not merely a bookseller but a digital conglomerate worth $1.3trn that consumers love, politicians love to hate, and investors and rivals have learned never to bet against. Now the pandemic has fuelled a digital surge that shows how important Amazon is to ordinary life in America and Europe, because of its crucial role in e-commerce, logistics and cloud computing . In response to the crisis, Bezos has returned to day-to-day management. However the world's fourth-most valuable firm faces many problems: a fraying social contract, financial bloating and re-energised competition. The digital surge began with online "pantry-loading" as consumers bulk-ordered toilet rolls and pasta. Amazon's first-quarter sales rose by 26% year on year. When stimulus cheques arrived in mid-April Americans let rip on a broader range of goods. Two rivals, eBay and Costco, say online activity accelerated in May. There has been a scramble to meet demand, with Bezos doing daily inventory checks once again. Amazon has hired 175,000 staff, equipped its people with 34m gloves, and leased 12 new cargo aircraft, bringing its fleet to 82. Undergirding the e-commerce surge is an infrastructure of cloud computing and payments systems. Amazon owns a chunk of that, too, through AWS, its cloud arm, which saw first-quarter sales rise by 33%. One question is whether the digital surge will subside. Shops are reopening. Yet the signs are that some of the boom will last, because it has involved not just the same people doing more of the same. In America "silver" customers in their 60s have set up digital-payment accounts. Many physical retailers have suffered fatal damage. Dozens have defaulted or are on the brink. In the past year the shares of warehousing firms, which thrive on e-commerce, have outperformed those of shopping-mall landlords by 48 percentage points. All this might appear to fit the script Bezos has written over the years in his letters to shareholders, which are now pored over by investors as meticulously as those of Buffett. He argues that Amazon is in a perpetual virtuous circle in which it spends money to win market share and expands into adjacent industries. From books it leapt to e-commerce, then opened its cloud and logistics arms to third-party retailers, making them vast new businesses in their own right. Customers are kept loyal by perks such as Prime, a subscription service, and Alexa, a voice-assistant. By this account, the new digital surge confirms Amazon's inevitable rise. That is the view on Wall Street, where Amazon's shares reached an all-time high on June 17th. Yet from his ranch in west Texas, Bezos has to wrestle with those tricky problems. Some common criticisms of Amazon are simply misguided. Unlike Google it is not a monopoly. Last year Amazon had a 40% share of American e-commerce and 6% of all retail sales. There is little evidence that it kills jobs. Studies of the "Amazon effect" suggest that new warehouse and delivery jobs offset the decline in shop assistants, and the firm's minimum hourly wage of $15 in America is above the median for the retail trade.
Amazon's second problem is bloating. As Bezos has expanded into industry after industry, his firm has gone from being asset-light to having a heavy balance. Today it has $104bn of plant, including leased assets, not far off the $119bn of its old-economy rival, Walmart. As a result, returns excluding AWS are puny and the pandemic is squeezing margins in e-commerce further. Bezos says the firm can become more than the sum of its parts by harvesting data and selling ads and subscriptions. So far investors have taken this on trust. But the weak e commerce margins make it harder for Amazon to spin off AWS. This would get regulators off its back and liberate AWS, but would deprive Amazon of the money-machine that funds everything else. Bezos's last worry is competition. He has long said that he watches customers, not competitors, but he must have noticed how his rivals have been energised by the pandemic. Digital sales at Walmart, Target and Costco probably doubled or more in April, year on year. Independent digital firms are thriving. If you create a stock market clone of Amazon lookalikes, including Shopify, Netflix and ups, it has outperformed Amazon this year. In much of the world regional competitors rule, not Amazon; among them are Mercado Libre in Latin America, Jio in India and Shopee in South-East Asia. China is dominated by Alibaba,jd.com and brash new contenders like Pinduoduo. Imitation is the sincerest form of capitalism. Bezos's vision of a world that shops, watches and reads online is coming true faster than ever. But the job of running Amazon has become no easier, even if it no longer involves packing boxes.
The book is based on 300 interviews, as well as the author's fifteen years of reporting for Newsweek, the New York Times, and Businessweek.It is at once a deftly crafted biography of both Amazon, the company, and Jeff Bezos, the man. Stone's book takes the story forward and he enriches what is known with new details and testimony, weaving together an immense amount of material into a readable, compelling account of a complex, dynamic company and its inspired founder.
7/3/2021.
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