Internet retailing giant Amazon is to create 950 jobs in Scotland, 750 of which will be based at a new £40m new fulfilment centre in Fife. The deal was won for Scotland with support by £2.5m in tax payer grants from Scottish Enterprise, £2m towards the site development costs and another £1/2m in training grants.
The new facility will ship worldwide, and will be Amazon’s biggest warehouse in the UK and will be 40% bigger then their current largest warehouse in Swansea. It won’t be Amazon’s only Scottish facility though, they already have fulfilment centres in Gourock, Inverclyde and Glenrothes, Fife, as well as the Amazon Development Centre in South Queensferry, Edinburgh.
As well as recruiting new permanent staff, Amazon also say they expect to recruit 1500 temporary workers at the busiest times of the year
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Well done Amazon.
Hopefully it won’t snow up there, otherwise you won’t get your order.
Subsidies clearly disrupting the market, as a distribution centre it should be close to the customers. All that extra diesel burnt by the carriers, will Amazon pay for it or will it be added to the total cost and spread amongst all the carriers customers? Looks like another case of small business subsidising big business.
As Amazon open more distribution warehouses it affects FBA as your products may be held in different locations.
When we started on FBA we had to send everything to Ridgmont, Bedfordshire but after Swansea opened some products had to be sent there increasing the cost of getting good to them as we could no longer consolidate all into one shipment.
We gave up on Fulfilment by Amazon as it started to take up to a month for stock to be processed as received at distribution centres. Also they make it too easy for customers to send goods back with free returns which resulted in unsellable returned stock that we had to pay for removal or pay storage.
Whichever courier Co, amazon use will benifit from this…. Most mail order traffic is to Scotland**, so currently their (the couriers) st t least this will even up the loads both way.
**With the exception of Norf that is…..
I live in Cornwall and can appreciate the problems that Scotland has. Its remote and its very easy to justify that every New facility in the Country should be inside the M25. But where does that leave the people in Cornwall Scotland etc. By allowing/developing facilities in such as Scotland it provides jobs for the locals. Also as pointed out it tends to balance out shipments so fewer empty lorries returning from Scotland. Also isnt Whiskey from Ireland not Scotland(ref 3.1.1.1.1 Old Hand). Now all we need is a major Distribution Centre in Cornwall to stimulate our local jobs market.
I’ve just sold something to Russia on eBay and they have their postal address in our alphabet. Since they have a different alphabet with back to front R’s, I hope the postman over there can read English. I wonder if I get an e-mail asking where there order is due to a Russian postman who doesn’t understand English. I think I’ll ask them to e-mail their address in Russian as well and put two addresses on it.
I’ve sold to Singapore, but they where a former British Colony so they still use English in some way and I had not trouble at all. The thing is my sales have hit rock bottom and a sale is a sale. I really need the money.
Scotlands not really remote if anything its closer in actual time travelled, a
we travel most weeks from Scotland to
the midlands and beyond, the traffic is ok till you hit the m62 junction on the M6 then things clog up.
usuallyT akes us as longer from Manchester to Birmingham ,than it does to travel from Glasgow to Manchester
Ref 6.2 Gerry007 Motorways(M5) to Exeter. Dual Carriageway A38 to Plymouth/East Cornwall A30 Dual Carriageway(most of the way) to Lands End. 40 footer lorries seem to have few problems on Main Roads. Bit of a problem on our narrow country lanes. Those in London always seem to think that everything has to be inside M25 How about whole of population of UK(about 60 million) all move to within the M25 as well. Much more effecient to evenly spread facilities across the country so that people everywhere can have jobs and a future.
What an odd thread. My money is on Amazon, I very much doubt they picked straws, Scotland was chosen for a reason.
Amazon will have done a full financial analysis of the possible options and included in that will be the Grants received. Years ago I had to do similar in Cornwall but we were told that the “Grants” that we were in line for were not guaranteed. In fact we had previously been cheated out of a significant proportion of an earlier Grant. So our Managing Director gave the instructions that the Grants had to be ommitted from the calculations and anything received treated as an added bonus. Without the Grants the Factory Closed and the work transfered to Leicestershire and 80 people in an employment blackspot lost their jobs-yet the petty bureaucrat who cheated us out of the earlier Grant(and the idiot local MP who refused to take it up on our behalf) probably felt that he had done a good days work.
It is a bit of an odd place for a distribution hub, even with grant money. Journey times to the South of England are too long for drivers on a tachograph, having to add in loads of rest periods seems a bad idea.
But they must have done the maths.
Putting everything in the middle of the country or within the M25 would be a total disaster for the Country. To start with there is just not enough available land or indeed skilled labour for every Factory/Distribution Centre etc to be located in the middle of the country. Then what about the employment of all the people who do not live in the centre of the country or are there going to be massive new Housing Developments for them as well. so we have 60 million people and hundreds of factories/Distribution Centres and obviously they will need massive Schools/Hospitals etc and of course there will need to be massive Bus Garages/Freight Lorry Companies etc to service it all. Far more sensible to spread jobs and facilities across the nation.
I have just noticed that this comment system strips out emoticons, makes it more difficult to convey meaning, I can’t recall seeing a comment system do so previously.
If you(Old Hand) read ALL of the comments on this and indeed other issues you will find that regularly the suggestion is made that everything be located either within the M25 or in the Centre of the Country. But this is not only impossible it is economic and practical total insanity. When the powers that be at Amazon sat down to consider their options they will have considered a raft of factors Grants being just one of them. Others will have included such as Availability and Price of Land, of Skilled Labour(or Labour that can be trained), Local Wage Rates, Then they will have looked at the possible costs of transport(if they can negotiate such as Return Loads Discounts-Hauliers may be happy to offer discounts to fill their lorries going back the other way), Years ago a Company that I worked for another factor was the location of the Managing Directors Holiday Cottage(he owned it before the Factory was built). Amazon probably calculated that to put the facility in the M25 or Centre of the Ciountry would dramatically increase their overall costs-possibly as much as double or treble them.
The title says it all, its about fulfillment by Amazon. They need the growth from FBA to increase their profits and share price, so they have to build the centre first. I don’t think FBA is going to work. Apart from the unrealistic costs the biggest problem is that FBA items compete with Amazon themselves , if they slash the price then your items sit there unsellable while you pay to have them stored there. Its going to work for very few people.
I have just re-read the various postings. May I make a point. Grants are for the setting up of the facility and there may be some grants available for re-equipment or modernisation but there are usually no grants for day to day running costs. So when Amazon or indeed any other company considers its options it has two sets of figures to consider. The first is the costs involved in setting up the facility. Then the second is once it is set up its the financial viability for its continued operation. Over the years we in Cornwall saw many new factories being opened up with various Grants and then two or three years down the line when the Grants ran out the factory would close and the facilities being transfered up-country. In most of those cases the Management had not considered the long term running costs or possibly as was usually said down here that they waited until they did not have to repay any of the grants(you often have to repay a proportion of the grants if you close down within a set period) and then they transfer5ed everything up-country. Now I am not saying that Amazon plan to close it down in 3 or 5 years but it has happened in Cornwall. From my point of view I would welcome Amazon looking to Cornwall for its next facility. There are other factors to consider. A facility offering good well paid jobs usually boosts the local jobs market and pay rates go up across the board. Certainly my son(also in Cornwall) is paid a lot less than others with the same qualifications doing the same job up-country. So if the local wages rates went up perhaps so would his. Probably the same in Fife.
Some of the postings seem to critisise the idea of Grants. Government has a responsibility to spread economic well being across the Country. Over the years there have been many such Grants to try to develop Industry in other parts of the Country. Remember a Factory/Distribution Centre benefits not only those who work in it. The employees spend their wages locally. So the local Garage, Shop, Dry Cleaners, Garden Centre etc all see a boost to their turnover. Economists will tell you that each £1 of Wages generates additional monies in the local economy. There is some disagreement about how much but it is reasonable to suggest that £1 additional wages generated because of such Grants probably generates about £5 additional in the local economy. This is not a one off but a continuing boost. So Fife should see a long term improvement to its economy. This can only be a good thing for the Nation and the people of Fife. Obviously Amazon has calculated that it will be a long term benefit to Amazon. So its really a Win-Win Situation. Obviously all of these benefits would have been lost(with the possible exception of Amazons-because had those Grants not been available they would have found another site elsewhere and gone through the whole Financial Analysis for the figures for that site and probably still enjoyed a benefit) if the facility had been located in the Centre of the Country or inside the M25. Now all we need is for Amazon or somebody else to decide that Cornwall is the ideal location for their facility.