Amazon destroying millions of items of unsold stock in its warehouses every year(itv.com)
itv.com
Amazon destroying millions of items of unsold stock in its warehouses every year
https://www.itv.com/news/2021-06-21/amazon-destroying-millions-of-items-of-unsold-stock-in-one-of-its-uk-warehouses-every-year-itv-news-investigation-finds
18 comments
Is there a name for this economic phenomenon where actors rather destroy goods than give it away or manage it in another, less wasteful way?
I don't know any name for it, but it's well-known in economics.
If you want a new, unused hard drive, drop by my office, there's one on a shelf here. It was bought for a sensible reason. But selling it, or finding someone I could give it to, isn't worth my while.
So someone has a pallet of Dyson fans on a shelf in a warehouse in Dunfermline, and for whatever reason the time/effort/money costs of storing it there or shipping it elsewhere outweigh the likely income from selling it later.
I'm a bit surprised that Amazon doesn't operate a market for that kind of thing. Bulk Marketplace, no returns, no warranty, FOB Amazon warehouse. Or maybe it does?
If you want a new, unused hard drive, drop by my office, there's one on a shelf here. It was bought for a sensible reason. But selling it, or finding someone I could give it to, isn't worth my while.
So someone has a pallet of Dyson fans on a shelf in a warehouse in Dunfermline, and for whatever reason the time/effort/money costs of storing it there or shipping it elsewhere outweigh the likely income from selling it later.
I'm a bit surprised that Amazon doesn't operate a market for that kind of thing. Bulk Marketplace, no returns, no warranty, FOB Amazon warehouse. Or maybe it does?
Here in the states there are liquidators near the warehouses that sell palettes of returned items, or break them apart and auction/sell things off.
If you want to live vicariously there are countless YouTube videos where people buy a palette and then unwrap and inventory every item. It's treasure hunting since it's a mixed of used/broken things and brand new stuff that was just returned for some other reason.
In the Chicago are there's https://slibuy.com/. They used to sell palettes but now it looks like they break it up and sell items individually.
If you want to live vicariously there are countless YouTube videos where people buy a palette and then unwrap and inventory every item. It's treasure hunting since it's a mixed of used/broken things and brand new stuff that was just returned for some other reason.
In the Chicago are there's https://slibuy.com/. They used to sell palettes but now it looks like they break it up and sell items individually.
Amazon has "Warehouse Deals" for damaged items (either in the warehouse or transport, or, I guess, returned by customers). You can specifically search for them.
A few times I got perfectly brand new products, box not opened or damaged.
A few times I got perfectly brand new products, box not opened or damaged.
>I'm a bit surprised that Amazon doesn't operate a market for that kind of thing. Bulk Marketplace, no returns, no warranty, FOB Amazon warehouse.
Probably illegal at least in Europe.
Probably illegal at least in Europe.
The word "potlatch" means a big party where rich chiefs destroy items of value to prove how rich they are.
That's amazing to know!
Unregulated capitalism. As long as it makes economical sense everything else can be ignored, giving away things probably would be too much paperworks. It's like supermarkets spraying bleach in their trash so that you can't grab soon to expire goods
Sometimes the problem is regulated capitalism. That is, the liability created by civil courts, consumer protection laws and government bodies like the FTC. If the supermarket couldn't be sued or fined for selling just expired food then they'd probably happily sell it for $0.2 on the dollar in a bargain bin. Perhaps a similar thing is going on in the Amazon case?
This is clearly not a problem with capitalism. Do you think that Communist countries are somehow less wasteful?
Try reading “The Liberators” by Viktor Suvorov. The first chapter is pretty instructive.
https://archive.org/details/ViktorSuvorovTheLiberatorsMyLife...
Also, supermarkets do not spray bleach in their trash.
Try reading “The Liberators” by Viktor Suvorov. The first chapter is pretty instructive.
https://archive.org/details/ViktorSuvorovTheLiberatorsMyLife...
Also, supermarkets do not spray bleach in their trash.
> This is clearly not a problem with capitalism.
They keyword is "unregulated", not "capitalism"
The fact is that it costs them less to destroy the goods instead of putting them back in the system or giving them away. No regulations = the only thing that matters is $
Idk about the rest of the world but France banned bleaching of supermarket trashes in 2016, at the time it was an "extreme and ground breaking" law, now they're legally forced to give them to charities (another example of regulation)
They keyword is "unregulated", not "capitalism"
The fact is that it costs them less to destroy the goods instead of putting them back in the system or giving them away. No regulations = the only thing that matters is $
Idk about the rest of the world but France banned bleaching of supermarket trashes in 2016, at the time it was an "extreme and ground breaking" law, now they're legally forced to give them to charities (another example of regulation)
I’m saddened to hear that French supermarkets were doing something that stupid. Most of the rest of the world doesn’t do that. I also don’t know how that law is supposed to work; when I worked in a grocery store as a teenager, most of the food I threw away was rotten or moldy. There’s no way I would willingly give that food to a charity. Actually, now that I think about it, perhaps the bleach was just an attempt to cut down the amount of mold spores people were exposed to.
The problem isn’t a lack of regulation either. The problem is just humans making mistakes. A human decided to try to sell product X, but couldn’t do so. Their stock was sitting in a warehouse racking up storage fees, and it would also cost money to ship it somewhere else. Adding regulations won’t reduce the number of mistakes that people make, it will only increase the cost of those mistakes. That cost will simply be passed along to the rest of us, making everything more expensive to buy.
The problem isn’t a lack of regulation either. The problem is just humans making mistakes. A human decided to try to sell product X, but couldn’t do so. Their stock was sitting in a warehouse racking up storage fees, and it would also cost money to ship it somewhere else. Adding regulations won’t reduce the number of mistakes that people make, it will only increase the cost of those mistakes. That cost will simply be passed along to the rest of us, making everything more expensive to buy.
Some (a lot?) of people, especially today, have the patience to wait 6/12/18 months to obtain at a deep discount or even for free something that they *may* need to buy.
I have a vacuum cleaner that isn't very good and is likely to fail in the future, at some point I will need to replace it. I won't buy one today for full price, but when it does fail I will have to. If I could get a replacement today for 0-50% of the price new I would jump at the chance, but I'd be a lost sale.
I have a vacuum cleaner that isn't very good and is likely to fail in the future, at some point I will need to replace it. I won't buy one today for full price, but when it does fail I will have to. If I could get a replacement today for 0-50% of the price new I would jump at the chance, but I'd be a lost sale.
Throwing away stuff is just too cheap. If you somehow managed to pass the full enviromental costs of trash generation up the chain there would be way less of that and less manufacturing in total.
Publisher sometime send books to bookstores with the understanding that stores only pay for the books that are sold. That creates a problem, for example if a bookstore gets 100 books and only sells 60, what to do with the other 40 books?
One option is to return the books to the publisher, but that can be an expensive proposition (books are heavy). So another approach is to destroy the books and provide proof that the books were destroyed by ripping out a cover page and then sending the cover pages back to the publisher. This way, the publisher has some confidence that the bookseller isn't lying about how many books it sold while at the same time they are lowering the frictions to the bookseller by not requiring them to pack and ship the unused books back.
The fact of the matter is that for many items, production costs are a rather small portion of the retail price. Search costs are far higher -- e.g. finding someone who wants the item and is willing to pay for it is much more expensive than producing the item. The solution to this is not to overproduce lots of goods and airdrop them on the population, the solution ends up being to destroy inventory when the storage/transport costs exceed the expected value from selling the items.
If that means people are emotionally disturbed by stuff that is valuable to some people being destroyed, then so be it. A long time ago when my parents said I shouldn't waste food because there were people who were hungry, I replied that they can go ahead and give the food to whatever hungry people they found, but me overeating wouldn't help anyone who was hungry. They ended up throwing the food in the trash. Sometimes reality doesn't conform to our ideals.
One option is to return the books to the publisher, but that can be an expensive proposition (books are heavy). So another approach is to destroy the books and provide proof that the books were destroyed by ripping out a cover page and then sending the cover pages back to the publisher. This way, the publisher has some confidence that the bookseller isn't lying about how many books it sold while at the same time they are lowering the frictions to the bookseller by not requiring them to pack and ship the unused books back.
The fact of the matter is that for many items, production costs are a rather small portion of the retail price. Search costs are far higher -- e.g. finding someone who wants the item and is willing to pay for it is much more expensive than producing the item. The solution to this is not to overproduce lots of goods and airdrop them on the population, the solution ends up being to destroy inventory when the storage/transport costs exceed the expected value from selling the items.
If that means people are emotionally disturbed by stuff that is valuable to some people being destroyed, then so be it. A long time ago when my parents said I shouldn't waste food because there were people who were hungry, I replied that they can go ahead and give the food to whatever hungry people they found, but me overeating wouldn't help anyone who was hungry. They ended up throwing the food in the trash. Sometimes reality doesn't conform to our ideals.
When I think to all those LEGO bricks that get destroyed every year instead of reaching kids (or adults) hands...