Tuesday, February 27

Spain prepares an “Amazon rate” on home deliveries that may end up benefiting precisely Amazon

The Government of Spain is finalizing the plan for a new tax on parcel deliveries at home, an idea that has received the name of “amazon rate“. A proposal presented to the Minister of Finance, María Jesús Montero, by the group of experts who draw the main lines of the tax reform, and which not only includes e-commerce companies, but anyone who delivers packages at home .

This proposal considers home delivery taxable because of the “occupation of public space.” In other words, the activity of last-mile delivery men who park their vehicles on the street to make each stop on their route sheet. The Barcelona City Council had already been working on a similar idea, although with exclusions, such as home deliveries in vehicles with less than four wheels or parcel delivery between companies. A measure that comes from a debate that has arisen in recent years: happily embracing its extreme consumer convenience, externalities of delivery at our doors begin to appear.

Amazon is already your boss, your supermarket, your television and your Internet.  Now it wants to be your school too

Beyond the fundraising spirit

More than two years ago we started talking about how more and more voices were beginning to question an extremely accommodating model with the buyer. The Spanish Logistics Center, the employers of logistics companies in the country, warned in 2019 that if the urban environments of large cities such as Madrid were not adapted, significant problems would arise for their daily traffic, in view of e-commerce forecasts that they kept adding up the daily delivery figures.

Some studies carried out in the United States or the United Kingdom directly pointed to vans, much heavier and bulkier than motorcycles or bicycles, as one of the main problems in cities due to the congestion they cause in traffic. Also due to its pollution levels and acoustic impact. In New York, in fact, he has been planning the idea of ​​a tax of three dollars per package for more than a year.

And a simple logic: if the delivery vans have to leave each package at their customers’ homes, the time that vehicle spends rolling, its pollution and the time it usually spends double-parking It is much higher than that required by purchases that ask to be claimed directly at a collection point.

These types of points are less convenient for customers, although convenient in the case of those who hardly coincide at home with the delivery man’s arrival. But they are a respite for the finances of the selling company, which saves money compared to home delivery; and for the city itself, which lightens traffic and urban emissions.

Amazon, which gives its name to this rate due to the metonymy achieved, has been promoting this model for years, both with its own automatic lockers distributed by strategic points, such as gas stations or train stations; as with agreements with local businesses that act as improvised mini-logistics centers to scratch a few cents of commission per package (and some traffic in your store and possible cross-selling).

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A level above would be the premises specifically designed to perform this function in urban centers. In their favor, they would have an initial cost in the form of investment for the opening, but lower costs per package, which in the long run could both improve the customer experience by being more controlled by the logistics company, as well as a possible reduction in prices. There are also those who are trying to solve this problem by using drones for deliveries, but there are many more unknowns than certainties to think about its deployment, and more so in countries where most of us live vertically, such as Spain. DHL already got off that bandwagon.

The candidates for winners in the face of such a measure: physical stores, centralized delivery points and companies with more financial muscle to avoid allocating this cost to the customer

Amazon itself, however, has also encouraged a purchase in which the important thing is that each order arrives as soon as possible, even if that means receiving three packages three days in a row, instead of grouping them in a single box. More complacency with the consumer in exchange for less logistical and economic efficiency. Amazon can afford it. Most other businesses probably don’t.

something you can give a clue as to who would benefit from such a rate: Amazon, which with the enormous empire achieved has it easier than any other company to continue operating without increasing its costs, or at least only partially. For the rest, it would be imperative to allocate the cost of a tax per package delivered directly to their buyers. It is also true that a tax on online purchases sent home may increase purchases in physical stores, especially in cities where it is an affordable alternative.

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Another presumable scenario if this rate prospers is that of the commercial platforms themselves encouraging collection at ticket offices and delivery points, exempting the buyer from shipping costs and imposing them on home deliveries. If they have already been doing it without the need for this rate, it can clearly go further.

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