October 25, 2013

"All the states are competitive on this stuff, but I think Amazon realized that Wisconsin is not only open for business, Wisconsin is good for business."

Said Phil Jennings, president of Next/Partners, Inc. (and Wisconsin Law grad), explaining Amazon's selection of Kenosha for a $250-million distribution facility that brings "1,100 new jobs, including hundreds of high-paying technical and management jobs."
Jennings says he’s never met [Gov. Scott] Walker and didn’t contribute to his campaign, but he says the Republican deserves credit for trying to improve the state business climate. He contrasts that approach with former Gov. Jim Doyle and current Illinois Gov. Pat Quinn, both Democrats.

“Unlike Doyle and Quinn, Gov. Walker has worked hard to create the platform where Wisconsin can be attractive to Fortune 50 companies like Amazon,” he says....

Amazon has been criticized for running sweatshop-like operations, but Jennings says the Kenosha development will be a state-of-the art, air-conditioned facility that will include sophisticated package handling equipment.
The quote in the post title refers to the Scott Walker slogan: "Wisconsin is open for business."

ADDED: Meanwhile, in Milwaukee: "Special Prosecutor Named In Investigation Of Possible Criminal Activity Surrounding Scott Walker Recall Election." More jobs... for lawyers.

31 comments:

David Davenport said...

Has the state of Wisconsin given Amazon a sales tax waiver?

David said...

Kenosha is also a perfect geographic location for something like this. The political task was simply not to drive them away. In that respect Walker is an improvement. Though the lefties might have welcomed Amazon too.

Why is it that lefties love Amazon (except on the sales tax issue) and hate Wal-Mart? In many ways Amazon is far worse for local merchants and workers.

Mostly, I think, it's a issue of social class. Wal-Mart is too low class for today's lefties, far too unfashionable. "Work there? Why would anyone shop there?" That's what my lefty former spouse said.

C Stanley said...

My husband is currently building these types of Amazon warehouse facilities in San Antonio, Nashville, and Tampa. I have only seen the outer shell, but the scale is so vast- I think four football fields in width by seven in length. Apparently the inner workings are pretty ingenious. Rather than storing thongs in a way that is logical but logistically inefficient, things go in wherever there is room and the computerized picking system allows each item to be pulled and put on conveyors, for employees to prepare it for shipping.

TosaGuy said...

"Has the state of Wisconsin given Amazon a sales tax waiver?"

No it hasn't. Companies don't pay sales taxes, they collect it from customers who, in Wisconsin, are supposed to pay it via an entry on the state income tax form if the company doesn't collect it for them.

David said...

Another Walker investigation?

Sounds like they actually think he might be a good presidential candidate.

Marshal said...

Rather than storing thongs in a way that is logical but logistically inefficient

So they don't bother folding them?

TosaGuy said...

A friend of mine runs a small retail chain and he says he can battle any brick-and-mortar big box out there because of his customer service. If he stays in the ballpark on price he can compete.

However, he loathes internet retail because not only does internet retail have the same low price points as the big box, many also don't collect the sales tax, which for his business takes a good sum off the bill.

Bob Boyd said...

Insiders are saying Ann and Meade have been moving so many adult diapers thru the Althouse Portal that Amazon concluded building a warehouse in Wisconsin is the only way to keep up.

C Stanley said...

Rather than storing thongs in a way that is logical but logistically inefficient

So they don't bother folding them?

10/25/13, 9:10 AM


Heh, no, that would be my son's method of storing his clothing.

In case it wasn't clear, what I meant was that items aren't grouped by any sort of category within the warehouse.

FleetUSA said...

I find more and more big internet stores are collecting sales tax. Hence, not an advantage.

Their big advantages are in variety, ability to price compare, and shipping time. - Laptop shopping.

teej said...

I hate to burst your cheesehead bubbles, but Amazon is also building a new distribution center in Baltimore, MD. And Maryland is extremely business unfriendly, unless your business is sucking at the FedGov teat.

Amazon's decision are all about proximity to transportation infrastructure and populations.

Mark said...

What business with 1,100 employess has `hundreds' of supervisory and tech jobs at this distribution hub?

I like how they imply that there's going to be a lot of high-end tech jobs there, like Amazon is going to move their programmers to Kenosha.

They put it in Kenosha as it's close to Chicago and a major UPS distribution center [Oak Creek, WI] but outside of IL proper and thus no IL sales tax collection.

I don't see this as much a coup for WI. Better than nothing, but ...

David Davenport said...

No it hasn't. Companies don't pay sales taxes, they collect it from customers who, in Wisconsin, are supposed to pay it via an entry on the state income tax form if the company doesn't collect it for them.

No, you don't understand. Amazon has been asking states to refrain from collecting retail sales tax on Amazon and other firms' mail order* sales even after Amazon builds a physical presence in the state.

My understanding is that Tennessee has given Amazon some such deal, although the agreement is supposed to expire in two or three years.

Tennessee does not charge sales tax on mail order sales from firms without a physical presence in TN.

* "Mail order": old fashioned but still expressive locution.

Curious George said...

@ Mark

"{I don't see this as much a coup for WI. Better than nothing, but ..."

LOL It's a 250 million dollar project. And hint there Corky, there are a lot of technical jobs that aren't "programming".

Matthew Sablan said...

"In many ways Amazon is far worse for local merchants and workers."

-- Amazon has crippled local book stores that don't have niche markets. Even then, there have been numerous times I've been browsing, and the people I'm with will whip out smart phones and order a cheaper copy from Amazon if they don't need the book right now.

Curious George said...
This comment has been removed by the author.
TosaGuy said...

David.

I do understand and Amazon will collect WI sales tax.

By law, WI residents are supposed to pay sales taxes in all internet purchases. See Line 36



AJ Lynch said...

Is anyone else bugged about the amount of cardboard boxes etc you have to discard after getting an Amazon order? I wonder if any of the greens have analyzed that vs. buying locally. IOW, if I buy 200 Keurig cups at the Acme, the price is close to Amazon if I wait til it is on sale while with Amazon, I get a huge packing box and then have to cut it up and put in the trash. It seems a bit anti-green and don't get me wrong, I never hug trees.

David Davenport said...

No, you don't understand. Amazon has been asking states to refrain from collecting retail sales tax on Amazon and other firms' mail order* sales even after Amazon builds a physical presence in the state.

For additional clarity, make that:

Amazon has been asking states to refrain from collecting retail sales tax on Amazon and other firms' *mail order* sales within TN even after Amazon builds a physical presence in that state.

LuAnn Zieman said...

teej said "I hate to burst your cheesehead bubbles, but Amazon is also building a new distribution center in Baltimore, MD. And Maryland is extremely business unfriendly, unless your business is sucking at the FedGov teat.

Amazon's decision are all about proximity to transportation infrastructure and populations."
-------------
Then they could just a well have built in Chicago, couldn't they! It IS a hub.

David Davenport said...

Then they could just a well have built in Chicago, couldn't they! It IS a hub.

Chicago is business un-friendly.

Kirk Parker said...

"Amazon has been criticized for running sweatshop-like operations"

Man do I get tired of this! People are all concerned about how all the unskilled jobs are disappearing--you need a college degree for practically everything these days. Then Amazon shows up, puts up a big distribution center with hundreds if not thousands of simple-labor fairly-unskilled jobs, and are these same people happy? NOOOOOOOO........

Kirk Parker said...

As far as the "sweatshop" slur, I'm pretty sure guys digging ditches the old-fashion hand-tool way got pretty sweaty...

Andy Freeman said...

> "Amazon has been criticized for running sweatshop-like operations"

I'd much rather have people working in sweatshops than on any form of govt aid. Heck, even if they're on govt aid, I want them working.

And no, their kids aren't an excuse. For every N single parents, one can watch the kids while the others work.

SteveR said...

Garage Mahal - John Doe

RecChief said...

the forbes piece quotes ThinkProgress? hahahahaha. Yes, a very straight middle of the road piece of reporting there. Almost as good as our local paper, which is known in these parts as "The Locust Street Liar"

C Stanley said...

"Amazon's decision are all about proximity to transportation infrastructure and populations."

They are working on a model to be able to ship most goods out same day, so they are greatly expanding their warehouse footprint and are definitely looking to build near transportation hubs. That said, if there's a place across a state line that has a more favorable business climate, they will choose that option.

RecChief said...

Also, go back and look at historical descriptions and pictures of real sweat shops. Apparently all manual labor jobs are sweat shop conditions nowadays.

jeff said...

" hate to burst your cheesehead bubbles, but Amazon is also building a new distribution center in Baltimore, MD."

How, exactly would that burst anyone's bubble? They ARE building a distribution center in Wisc. It seems logical they would have several of them geographically located in the US. What was the point of that comment?

Edmund said...

Amazon has flipped on the sale tax for mail order issue, and has been lobbying in favor of requiring mid to large mail order firms collect and remit sales taxes on orders. Probably because their strategy of placing warehouses everywhere has them covers by almost all the state sales tax laws.

And they are trying to get to a point where they can offer one day delivery on popular items in most of the US and same day delivery in major urban areas.

Despite the cheerleading in the press release, about all the politicians had to do to get this center is not impose onerous taxes on them.

They will create some tech jobs at the center. Amazon is moving to a system where the goods are stored in bins on top of a robot (think a big, square Roomba) that move to the pickers, display info on the item to be picked, and then move off to recharge or deliver to another picker. Amazon liked it so much they bought the company that made the robots. So, there are repair jobs for the robots and IT.

David Davenport said...

" hate to burst your cheesehead bubbles, but Amazon is also building a new distribution center in Baltimore, MD."

Did Baltimore give Amazon a property tax abatement Deal of the Day?