Amazon-Whole Foods Deal Is Bad News For Store Cashiers And The Fight For $15 Minimum Wage – Forbes
The Amazon-Whole Foods deal will have winners and losers. Among the winners will be consumers, as Amazonâ€™s technology and superior services will provide more grocery options, saving them time and money at the same time.
Among the losers will be traditional neighborhood stores, which wonâ€™t be able to compete with Amazonâ€™s razor thin operating margins â€“ and minimum wage employees like cashiers, as Amazonâ€™s technology will make them dispensable and speed Â up a trend already underway in traditional retail chainsâ€¦and in the process, make the $15 minimum wage irrelevant.
While itâ€™s still unclear how Amazon will re-organize Whole Foods, a video released on Amazon Go stores last year may provide a good hintâ€”there will be no cashiers. They will all be replaced by technology, which monitors customers entering the store, records what they buy, and ensures that theyÂ areÂ charged the appropriate amount.
To be fair, the primary driver behind Amazonâ€™s new store concept is to speedÂ theÂ shopping experience by cuttingÂ downÂ the long lines usually observed in convenienceÂ stores, rather than cutting labor costs. And Amazonâ€™s technology may help revive Whole Foods, and expand positions in other store areas like food preparation and store shelf stuffing.
Still, Amazon usually operates at razor thin margins, and cutting an employee or two can make the difference between making and losing money.
The trouble is that other store chains will also have to do away with cashiers to keep up with Amazon, accelerating and broadening a trend already underway in the retail industry. Wal-Mart and Target have been using technology to replace labor that is usually paid the minimum wage.
Amazonâ€™s move comes as a franchise chain like Amazon — McDonaldâ€™s — announced that it would be replacing cashiers with ordering kiosks. McDonaldâ€™s is Â another company that operates at low margins; at least its franchises do, as the fast food market is highly competitive.
fast food market is highly competitive.
Source: Finance.Yahoo.com 6/18/2017
Thatâ€™s certainly bad news for the fight for $15 minimum wage movement. In fact, the movement may have helped Walmart, Target, Amazon, McDonaldâ€™s and the like to step up the trend to replace workers, who are now more expensiveÂ thanÂ technology, which usually becomes more efficient and less costly over time.
But thatâ€™s the reality in highly competitive industries where technology drives sales growth and demand for better-paid labor.
While minimum wage mandates help low paid workers bring home a higher pay in the short term, they send these workers to the unemployment lines in the long term, as companies replace labor with machines.
Thatâ€™s how a good cause turns into a badÂ one, an ugly truth for the fight for a $15 minimum wage.
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