When you're an Amazon seller, Amazon tells you which warehouse they want you sending your products to.
If that warehouse is far from you, it takes a long time to get there and it's expensive.
Unfortunately, Amazon moved our fulfillment center from nearby Dallas to...
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faraway Charlotte, NC.
We were paying $375 per truck load.
Now we are paying $2800 to $3000 per truck.
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It sucks.
If 14,000 Brain Flakes jars fit on that truck, our inbound shipping goes from $0.02/jar to $0.21/jar.
Amazon takes a 15% cut of any price increase so we need to pass an increase of ($0.21-$0.020/85%) = $0.22 to our consumers.
That seems like a small deal but...
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It's not, when you're moving through 100,000s of Brain Flakes per year.
We do ~100 truckloads per year and over the course of a year, the difference between our warehouses being assigned to Charlotte vs. Dallas is ~$270,000, all cost that we pass to consumers.
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There's been no explanation for this move. I thought it was because western fc's were overloaded, but I don't know after this poll.
Sucks to see others, our competitors not have this problem.
The best simplest way to measure the happiness of the people in a place is the median income divided by the median housing price.
This is the most basic explanation for why everyone is so unhappy globally, despite huge advancements in technology.
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Think about it:
You want to know how “well-off” you are. You have a salary, but that’s a number. So you ask yourself: what can I buy with this salary? Stocks are too abstract to mean anything. Education you probably don’t need. Healthcare expenditure is random.
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Food is cheap and hard to calculate; “what is $25 times 365 times the number of years I will live? Too complicated.” So what do you use to measure how well off you are? Housing. Everyone needs a house and they want to own it so they’re not owned by their landlord.
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Huge returns to scale within a city because some sites require dirt and other sites require dirt removal. The more sites you have the more likely you are to have a nearby site which needs what another site wants to get rid of.
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When you have such a nearby synergistic site, you can undercut your competition without losing margin.
I like this rollup idea because you can do it in a smaller city so it’s not biting off too much for you to chew.
Also, it’s probably hard for contractors with illegal
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labor to undercut you because it’s not so easy to put an illegal behind the wheel of a million dollar machine. Further, illegal operations can’t get the capital to get such machines.
As a bonus, it’s not whack. You can beat people by lowering prices instead of buying up
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Hey @fmanjoo if you are going to write an article in the NYT which my I am featured prominently, don't you think you should ask me for a comment, especially if you're going to imply I'm "discombobulated and that I'm used to employees leaping to my every demand"?
🧵👇
Perhaps you didn't because the context behind the tweet didn't fit the narrative of your story?
1. $33k container got delayed (likely won't make xmas) 2. 2 containers from vietnam will arrive after xmas 3. Key warehouse team-member injured 4. 70% of our China orders delayed b/c no⚡️
If we have debt in this situation we go bust.
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Thank god teammember's injury was not worse.
We will be totally fine, but if we are levered up in this position, we would not be because our costs are skyrocketing and as more containers arrive we get more and more strapped for cash before we get those toy xmas sales.
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There are a lot of unknown costs that can skyrocket from here.
We have multiple containers arriving in Los Angeles with the intention of being transloaded & shipped by truck.