Globalization and Amazon: Is Amazon Good for Us as a Society?

Amazon’s Global Reach

The online e-commerce giant, Amazon, has impacted the word in a huge way since its humble inception in 1994. It started as a book retailer and has skyrocketed to the fourth largest company in the world in terms of market capital (Statistica, 2020). Globalization has allowed for mass global trade and the flow of goods and services between countries, Amazon currently ships to over 100 countries worldwide and are always in the efforts to expand their operations (Business Insider, 2020). The article that lead me to choose this topic is an article by Canadian Insider Retrieved Oct 15th 2020 “COVID-19  drastically changing how Canadians, shop, celebrate and spend—Good news for Amazon.”

This article interested me as it is a very relevant subject considering our current reality of the Covid-19 Pandemic and how it has affected Canadians’ spending habits, and more specifically how it has affected and benefitted the Multi-National Corporation. My research led me to dive into topics concerning Covid spending patterns, worker treatment and the global impact Amazon has had during the Covid-19 pandemic, and led me to question, if Amazon is truly good for us as a society? 

Amazon has amassed an extraordinary global reach. Officially operating in 14 countries and shipping to over 100 countries worldwide, Amazon has most definitely benefitted from and made major advancements to Globalization. Their supply chain and shipping system is extremely complex, efficient and innovative. Amazon has even furthered their successful shipping capabilities by providing same day, 1-day and 2-day shipping in certain high population areas in multiple countries. As globalization has allowed for the improvement of communication between nations, this has allowed Amazon to use the internet and targeted loyalty and brand awareness.

These are very important attributes for a foreign business to have while operating at a multi-national capacity as it is difficult for consumers to blindly buy from a foreign business, but when the business has a good reputation and is commonly known it gives the consume  more trust in the product/service. Amazon’s Prime service has over 112 million subscribers worldwide with the average Prime member spending $1,400 USD annually (Statistica, 2020). Amazon’s reach and business capabilities would not be possible without the advancements to global banking brought by Globalization, as Amazon is now able to sell products in foreign currency and accept payment from foreign credit cards, payment systems and banks. 

Amazon’s success is huge and recognized worldwide, and its presence in Canada is no different. In 2018, Amazon Canada and Amazon US made a total of $4.705 billion USD in sales in Canada and scored the top two rankings of most popular online stores in Canada (Statistica, 2018). The ease of their platform has brought them much success and due to the global pandemic, the demand for their goods and services have only increased. As Canadians validly fear the outside and traditional brick and mortar stores due to the pandemic, it has driven demand for Amazon deliveries to increase. 64% of Canadians have stated that concern for the Covid-19 virus has led them to avoid shopping in-store according to Canadian Insider (Canadian Insider, 2020), and with the looming second wave, this percentage is expected to rise. While 47% of Canadians have reported they are finding themselves shopping more online than prior to the pandemic. Although this has brought Amazon a lot of business it has deeply hurt many small and mid size businesses in Canada.

Impact on the Canadian Economy (Political/Economic)

Small businesses make up 97.9 percent of all businesses in Canada, but with the pandemic increasing unemployment rates and large businesses offering cheaper alternatives, this has put them in extreme financial risk (IC, 2017). In a CIBC study, researchers found that 81% of small business owners in Canada stated that the current global pandemic has impacted business negatively, and 32% stated that they are worried about their business’s future (CIBC, 2020). In addition to the declining business and the bleak future for certain businesses, Canadian small businesses are being forced to transition to a form of online sales. However, this is daunting task for many small businesses as 74 percent of Canadian small business owners surveyed stated that their business is not currently built or equipped to transition to online sales. This puts Canadian small businesses at a disadvantage to large MNCs like Amazon who offer cheap and easily available products online.

Through the rise of MNCs, countless anti-Globalization and anti-MNC protests have occurred. Amazon is no stranger to massive protests but recently they have been experiencing an increase in them. Due to the global pandemic, and as previously mentioned, Amazon has been experiencing a huge amount of criticism for their treatment of employees during the pandemic. The company has been accused of using their workers as pawns for financial gain during one of the darkest times in recent history. Though Amazon’s profits continue to skyrocket during the pandemic, revenues exceeding $33 million USD per hour throughout the first three months of the pandemic, it is the employees who are being put in jeopardy for these profits (The Guardian, 2020). The blatant lack of respect for their workers health 

Conclusion

Globalization has led to the rise of MNCs present in our day to day lives. It seems difficult to go shopping or turn on the TV without seeing one of these huge corporations' stores or advertisements, but their impact on our society has gone beyond the goods in which they sell. Amazon has grown to the huge corporation it is today through the advancements made possible by Globalization, but although a successful company, the question remains – is Amazon good for society? Amazon has made a huge global impact and has created over a million jobs worldwide (Statistic, 2020), but to the effect of hurting small businesses, emitting exuberant amounts of pollution and poorly treating their employees. advertising to attract consumers from different countries around the world. Amazon has also built a large consumer base that exhibit large amounts of brand and safety.