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Amazon Go Getting Closer; Tech Tax Could Deter Shoppers

RetailTechNews’ weekly Amazon Watch brings you some of the company’s biggest moves from the past seven days, analysing how the giant is revolutionising the retail space. In this week’s edition: Amazon Go getting closer; Tech tax could deter shoppers; and Gearing up for Black Friday.

Amazon Go getting closer

Amazon Go is moving slowly towards its roll out. The cashless, staffless grocery store concept has overcome some early bugs and is looking to create protocols for spoiled or damaged merchandise.

While the technology has improved, the Amazon Go system still has difficulties figuring out who to charge when multiple people shop together. The store relies on customers launching a QR code-based app, which is scanned when they walk into the store. They are then tracked round the store, and products they take from the shelves are noted. The card which is linked to the app is then charged once they leave the store.

So, what will the eventual opening of Go stores mean for brick-and-mortar competition? If all the bugs are dealt with, then the store will represent another step along Amazon’s quest for frictionless shopping. It will mean that queueing in the supermarket will become a thing of the past, cutting the most monotonous part of grocery shopping. If this happens, leading supermarkets should be looking over their shoulders.

However, major technological issues, such as the fact that the app doesn’t currently know who to charge if a group is shopping together, or if a child takes an item from the shelf, are going to be an obstacle. Unless these can be overcome, the traditional food shop is not in immediate danger. Queueing isn’t a thing of the past, just yet.

Tech tax could deter shoppers

The world’s biggest tech companies, including Google and Amazon, are to be hit with a hefty tax bill, following the latest budget, announced this Wednesday.

The move targets tech companies that are legally shifting profits into tax havens. Amazon records all European sales in Luxembourg, to avoid paying VAT. Amazon has also been accused by MPs of failing to do enough about online VAT fraud, where sellers from outside the UK can undercut prices by not charging VAT.

Third-party sellers from overseas can effectively offer a 20% discount by not charging VAT. A clampdown on these rates is good news for smaller online marketplaces. Once VAT is better-enforced on foreign third-party sellers, Amazon’s competition will be more price-competitive.

This move might also deter third-party sellers from selling their products on Amazon, as they will have to pay a higher fee to sell their goods on the site. The increase in price, and fall in range of products, could see consumers look elsewhere for goods.

Gearing up for Black Friday

Amazon has pulled out all stops for Black Friday. They have increased their staff numbers by 83% to manage the retail chaos. This compares to a 34% increase at Argos, and 12% at the Royal Mail, who will play a big role in dealing with the 225 million parcels predicted to be in transit.

They have also rolled out a mobile app for truck drivers, that allows them to get in and out of Amazon warehouse facilities more efficiently by speeding up the pick-up and drop-off of packages at these locations.

The Relay app allows truck drivers to enter cargo information and use their mobile phones to scan a QR code for quick entry through the warehouse’s security gate, instead of the traditional badge entry. This will help handle the bumper sales associated with retail’s busiest time of the year.