Long Island And The Last Mile

Amazon distribution center in Bethpage (Image via Google Maps Street View)

If you tracked some of those Amazon.com packages during this holiday season, you may have noticed that some of them came out of an Amazon distribution center in Bethpage. With typical, cold Amazon efficiency, the 161,000-foot distribution facility was opened and fully operational just a few months after the lease was signed earlier in 2016. County Executive Ed Mangano issued a statement that “attracting Amazon as an employer will provide a significant boost to our local economy.”

The county’s Industrial Development Agency granted the property’s developer a fine tax exemption package in 2015, so I guess he’s got to say that. Or perhaps the county government is just flying on auto-pilot, able only to spew out insipid, happy news.

That facility symbolizes powerful forces that are starting to change life on Long Island. Either we get in front of some of it and make plans to adapt, or many lives could be shaken and disrupted needlessly.

As the Bethpage facility opened, Business Insider ran this headline: “New Amazon data from Wall Street should terrify all retail stores in the U.S.” Yikes. A new report says that Amazon has a warehouse or distribution center within 20 miles of 44 percent of the U.S. population. Amazon is now positioned to shoot for the holy grail of online retail: Same-day and even same-hour delivery services. Eventually, consumers could see traveling to physical stores as pointless.

Amazon is solving the last mile, the end of the delivery cycle where costs, inefficiencies and “frictions” with consumers rise.

The Amazon facility is not, in and of itself, evil. Amazon is the leading edge of technology and retail. It’s the first. It won’t be the last.

Amazon is being spurred by its Chinese counterpart, Alibaba, which has been offering instant delivery to millions of consumers. There has been a series of major Amazon announcements about new delivery system tests. In late 2015, they were testing same-day delivery in 14 markets. In February, the company began bypassing UPS and FedEx by using individual drivers on some routes. In September, they announced slashed shipping times from all overseas manufacturers.

Amazon has been so single-minded, ruthless and efficient in creating these logistical systems that it intends to go head-to-head with the traditional delivery companies. Amazon might open as many as 2,000 brick and mortar grocery stores. Because it can.

The big box stores as we’ve known them are going away. The distribution points are coming, and some of them will become highly or even completely automated.

Yes, that’s part of this. More and more of these systems will become robotized, sending out deliveries in automated ground and air vehicles.

It will change Nassau County.

The smart money has no doubt that this is happening. Morgan Stanley issued a report (Autonomous Vehicles & Municipal Bonds) about the effects of robot vehicles on local government budgets. With vehicles orbiting neighborhoods on-call, big parking facilities can be redeveloped into tax-paying developments, but fuel tax, license fee, parking fee and speeding ticket revenues will be way down. Barclays says that the average American household will reduce its car ownership from 2.1 vehicles today to 1.2, and a University of Michigan study comes to the same conclusion.

An amazing and unprecedented sequence of events and trends is going to change how people view suburbs, view this county, as a place of career opportunity and as a place to raise a family.

The 21st-century is about to hit Long Island in the face. We’re still stuck with a 17th-century decision-making framework and local finance system that hasn’t had a significant update since before the invention of television.

Michael MillerMichael Miller (mmillercolumn@gmail.com) has worked in state and local government. He lives in New Hyde Park. The views expressed in this column are not necessarily those of the publisher or Anton Media Group.

Michael A. Miller
Michael Miller (mmillercolumn@gmail.com) has worked in state and local government. He lives in New Hyde Park. The views expressed in this column are not necessarily those of the publisher or Anton Media Group.

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