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Amazon Is The Model For Investing For Your Company's Future

Last week, I talked about the collapse of Monster in the job board wars, which basically came down to them not attempting to invest in the future - even if they weren't sure what the future was.

That's part of the deal when you spend profit on R&D.

What can you learn from that as a leader or HR pro?  Investment in the future is kind of important.  So the next time you need 2K to send some employees to training, here's some more "guilt fodder" you can use with the powers that be to at least get some crumbs for training.

Amazon. I've written before about how they invest so much in R&D that net profits are almost always close to zero, which is amazing.  Check it out in the chart below from Business Insider (email subscribers click through on post title for picture):

Chart-of-the-day-amazon-revenue-profits

Here's what I wrote three years ago:

Amazon has managed to reinvest in the business to the point that they have basically no net income run rate 18 years later with a 60 Billion revenue run rate.  That type of infrastructure investment is what should make FedEx and UPS pretty damn distrustful of Amazon.  60 distribution centers?  You think at some point they just might add planes and vans and cut the middle man out?

Guess what was announced this week?  Planes at Amazon. Check it out:

The first freighter jet to carry the Amazon brand is primed for its public debut in Seafair’s sunny skies, after making a stealthy flight from New York to Seattle in the middle of the night.

The plane, emblazoned with “Amazon” on its belly, “Prime Air” on its sides and the Amazon smile logo on its tail, will fly over Lake Washington during the Boeing Seafair Air Show at around 1:15 p.m. Friday, Saturday and Sunday. Until now, the big reveal was kept so hush-hush that Seafair organizers referred to the event only as a “Special Guest Flyover.”

The Boeing 767-300 jet is part of what will eventually become a fleet of 40 planes, transporting cargo between Amazon’s distribution centers for delivery to customers. Clark said the planes will mesh with Amazon’s network of 4,000 branded truck trailers, the Uber-like Amazon Flex delivery system, and the services provided by transportation partners such as UPS and FedEx.

You think the people at UPS and FedEx aren't thinking about the eventual hole in revenue that's going to be caused by Amazon creating its own shipping network?  You think they aren't wondering if at some point Amazon isn't going to try to take ALL THE BUSINESS?

Interesting times.  Monster yawned when Indeed started scraping every job they could find for free.  I'll guarantee you UPS isn't yawning about Amazon's planes.

Comments

Maina

Interesting

Daniel Nyukuri

This is a nice model for investing in business

Purity Karani

Awesome article

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Bobby J.

This is a really awesome article. I bet you're right - slowly but surely Amazon will take over the world, starting with a shipping service.

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