cover-up and unreported injuries that leads to personal tragedies for those affected and fear for those lucky enough to avoid injury.44
THE GIANT IS VULNERABLE
The irony in this seemingly bleak situation is that the tighter the supply chain, and the faster goods move into, through, and out of Amazon’s capital-intensive facilities, the more vulnerable is its logistics system to disruption. This is true of the logistics industry as a whole. Indeed, since the turn of the twenty-first century, a whole new discipline of supply-chain risk management (SCRM) has supplemented the older field of supply-chain management (SCM) to deal with the mostly unpredictable disruptions at any one of many points in the supply chain.45 As one SCRM expert puts it, “JIT removes slack from operations and makes them vulnerable to the slightest hiccup. If there is even a small delay, breakdown, accident, surge in demand, new product or any other change, there is no cushion and the whole supply chain comes to a halt.”46 As an industry practitioner put it more modestly, “Because supply chain risks arise from the interaction between organizations, they are likely to affect several organizations through rippling effects.”47
Amazon executives and managers are, of course, aware of the vulnerability of the company’s logistics system. In its SEC 10-K report, Amazon management speaks of its “high inventory,” but also mentions that “our ability to receive inbound inventory efficiently and ship completed orders to customers also may be negatively affected by inclement weather, fire, flood, power loss, earthquakes, labor disputes, acts of war or terrorism, acts of God, and similar factors.”48 Labor disputes are fairly low on its list, though just above terrorism and divine intervention, largely because so far collective workers’ direct actions are relatively new to Amazon. Bearing in mind the newness of most Amazon facilities, the lack of collective action should not surprise us. As the workforce becomes aware of its shared situation, its interlocking sources of power and leverage, and the first successful acts of worker resistance become widely known, this is certain to change.
It is worth noting as well that even Amazon’s high-powered data centers are not safe from disruption, which can have more than a mere ripple effect whatever the cause. In 2011, Sheffi tells us, “a minor outage in Amazon’s East Coast data center cascaded when systems designed to ensure Amazon’s reliability actually clogged the network with what Amazon described as a ‘re-mirroring storm.’”49 Indeed, such disruptions are relatively common. A 2018 survey of nearly 900 data center personnel across many industries found that 31 percent had experienced outages in the last year and that over the previous five years almost half of those surveyed reported outages or IT failures. Thus, in addition to IT and software employees, maintenance workers of various types are crucial to the operation of data centers.50
The second source of vulnerability is the fact that despite its increasing dominance in online retail and computer services, Amazon faces competitors in most of the countries in which it has planted its flag. Google, Walmart, Target, and others remain competitors in the U.S., while it faces giants such as Carrefour in Europe, and the new and even more threatening giants Alibaba and JD.com in China.51 That Amazon appears to be winning in the West is almost entirely due to its superior logistics infrastructure. But in order to justify its huge fixed investments, Amazon must stay ahead of the crowd. That, of course, is the nature of capitalist competition: to stay ahead, a firm must invest to increase productivity and control prices to expand its market.52 And that is another reason why almost any significant disruption of Amazon’s time-bound logistics system can cost it market share, as well as immediate monetary losses.
There is an even more fundamental reason why Amazon workers possess a high level of potential power: the company’s deeply embedded capital-intensive facilities. The fixed nature and recent construction of its global logistics system means that despite its international presence, its facilities in any one place are not about to move “overseas.” They are costly sunk investments that serve a specific, resident, mostly affluent consumer base. Its annual investments in these embedded facilities have continued to grow faster than Walmart’s and are spent almost entirely on its logistics framework. In 2018, for example, Amazon spent $13.4 billion on fixed property and equipment, while Walmart spent only $5.2 billion on these, in spite of the fact that its global sales are over twice those of Amazon.53
As political economist Anwar Shaikh argues, “Capital-intensive industries will also tend to have high levels of fixed costs which will make them more susceptible to the effects of slowdowns and strikes.”54 Amazon’s Form 10-K, for example, tells us that in 2018 its global leasing and other regular annual obligations ran to $131 billion, which is a huge portion of its total expenses, much of it for leasing land and warehouse facilities.55 These are financial obligations that must be met during a strike or job action. This increases what economist Howard Botwinick has called the employer’s “cost of obstruction”—that is, the cost to employers who attempt to block or defeat workers’ actions. Clearly, high fixed costs raise this “cost of obstruction” significantly for Amazon, strengthening the hand of workers who dare to take full-scale action.56
Finally, Amazon is not an island unto itself. Its workers are part of the broader logistics workforce in the U.S. and internationally. Like other warehouses and centers of transportation, Amazon facilities in the U.S. are often located within the nation’s 60 or so giant “logistics clusters” of warehouses and transportation networks in which thousands and tens of thousands of workers facing similar conditions are geographically concentrated. Altogether about 4 million workers are employed in this sector.57 As Amazon workers begin to act and organize, they will be part of a broader movement in which solidarity can and must extend across company lines. At the same time, the ruthless exploitation and oppression of its workforce are producing the sparks that can ignite worker resistance throughout its system that, ironically, just might make Amazon’s own slogan “Work Hard, Make History” a reality with which Jeff Bezos had not reckoned.
NOTES
1. Brad Stone, The Everything Store: Jeff Bezos and the Age of Amazon (London: Corgi Books, 2013), p. 243.
2. Scott Galloway, The Four: The Hidden DNA of Amazon, Apple, Facebook, and Google (London: Corgi Books, 2017), p. 41.
3. Natalie Berg and Miya Knights, Amazon: How the World’s Most Relentless Retailer Will Continue to Revolutionize Commerce (London: Kogan Page, 2019), p. 232.
4. Daniel P. Bearth, “Is Amazon a Logistics Company?” Transport Topics, April 8, 2019, www.ttnews.com/articles/amazon-logistics-company-all-signs-point. Accessed April 19, 2020.
5. Galloway, The Four, p. 31.
6. Berg and Knights, Amazon, pp. 14–15.
7. U.S. Securities and Exchange Commission, Form 10-K AMAZON.COM INC. For fiscal year ended December 31, 2018, p. 36; U.S. Securities and Exchange Commission, Form 10-K AMAZON.COM INC. For fiscal year ended December 31, 2010, p. 37; U.S. Securities and Exchange Commission, form 10-K, WALMART INC., For the fiscal year ending January 31, 2019, p. 32.
8. Jesse LeCavalier, The Rule of Logistics: Walmart and the Architecture of Fulfillment (Minneapolis: University of Minnesota Press, 2016), passim; Stone, Everything Store, p. 207.
9. Edna Bonachich and Jake B. Wilson, Getting the Goods: Ports, Labor, and the Logistics Revolution (Ithaca, NY: Cornell University Press, 2008), pp. 96–101; Marc Levinson, The Box: How
