Book review: The Everything Store

At the end of 2017, I read and really enjoyed Brad Stone's book The Upstarts (which I reviewed here). So I looked for other books by the same author. It turns out, I already had one on my shelf that I hadn't read - The Everything Store. The book tells the story of Jeff Bezos, and in particular of the rise of Amazon, initially as an online bookstore, and later as an online purveyor of almost everything (hence the title).

As he did for Uber and AirBnB in The Upstarts, in this book Stone does an excellent job of chronicling the history of Amazon. The key players (and there are many) are all included and their contributions to Amazon are noted in some detail. Stone includes lots of anecdotes that help you to really feel the relentless pace of development of the company over the years including, surprisingly, that they briefly toyed with the idea of calling the company Relentless (indeed, the web address relentless.com still takes you to the Amazon homepage today!).

Many of the details in the book, I had already read elsewhere over the years. However, there were still many stories that were new. I hadn't quite appreciated Bezos's total dedication to low pricing, but this quote in relation to Amazon Web Services (AWS) captures it well:

Bill Miller, the chief investment officer at Legg Mason Capital Management and a major Amazon shareholder, asked Bezos at the time about the profitability prospects for AWS. Bezos predicted they would be good over the long term but said he didn't want to repeat "Steve Jobs's mistake" of pricing the iPhone in a way that was so fantastically profitable that the smartphone market became a magnet for competition.

The comment reflected his distinctive business philosophy. Bezos believed that high margins justified rivals' investments in research and development and attracted more competition, while low margins attracted customers and were more defensible.

In its determination to capture customers through low prices, Amazon has driven hard bargains with its suppliers, and the book contains lots of stories to that effect. It has also driven hard bargains with its employees, and if the book is missing one thing, it is the lack of stories from the front line. I guess that many readers would not have appreciated it in a business book, but I wanted more than a few isolated anecdotes about "top-grading of employees" (where managers grade employees along a curve, and "dismiss the least effective performers"). Even those few anecdotes only appeared towards the very end of the book. However, despite their absence, there is no doubt from reading the book of the challenges that working for Jeff Bezos presents. He appears to be a hard taskmaster.

The book doesn't lack humour though, such as the story of the missing pallet of Jigglypuff Pokemon toys in one fulfilment centre:

The group was looking for a single box inside an eight-hundred-thousand-square-foot facility. "It was very much like that scene at the end of Raiders of the Lost Ark," Rachmeler says. She dashed out to a nearby Walmart to buy a few pairs of binoculars and then passed them out among her group so they could scan the upper levels of the metal shelving....

After three days of exhaustive searching, at two o'clock in the morning, Rachmeler was sitting, spent and dejected, in a private office. Suddenly, the door flew open. A colleague danced in, and Rachmeler briefly wondered if she was dreaming. Then she noticed that the woman was leading a conga line of other workers and that they were jubilantly holding above their heads the missing box of Jigglypuffs.

I guess it wasn't all bad news for the employees of Amazon. It has made a large number of them (not least Bezos himself) fabulously wealthy. For a company that was originally "conceived in 1994 on the fortieth floor of a midtown New York City skyscraper", Amazon has certainly come far. And this book does a great job of showing you just how far it has come.