It is the decisive moment of the year for businesses with the arrival of ‘Black Friday’ and the Christmas celebrations. But here, too, 2020 is different: for many European businesses, whether they close the year better or worse over the coming weeks isn’t what’s at stake. What’s at stake, frankly, is their survival. If they do not perform well, they will shutter the windows forever, impoverishing the social and economic fabric of European cities.
The extreme difficulties right now arise mainly from the effects of the coronavirus pandemic which, for most of the year, has caused businesses to be at half-speed or even totally shut down.
The pandemic drastically aggravated a situation that was already difficult, but in these terrible months the business world has continued to turn, essentially in another area: digital. We have seen a significant boost in the digitalization process of shops and businesses, often family ones, which until a few months ago existed totally apart from the phenomenon of digitalization. The will of entrepreneurs and the strength of telecommunications networks have made it possible to advance in just months in what would have been done in years. It is undoubtedly some good news in the midst of a disheartening panorama.
But when it comes to business and digitalization, the huge phenomenon of the year has been the rise of Amazon, the distribution giant from the United States. Let’s take just a couple of pieces of information: from March 11, when the WHO declared COVID-19 a pandemic, to exactly eight months later, on November 11, its share price rose by 72%. And the year’s second quarter results, $5.243 billion in profit, were the best in the company’s 26-year history.
We have nothing against Amazon’s extraordinary performance, on the stock market and financially, or that of any other company. But we have to ask ourselves about the consequences of their market dominance. How did they achieve it? Is this the digital business model we want for the EU? And what effects does their enormous strength have?
These are questions that also bother the European Commission, which has been investigating Amazon for years because of its dominant market position. Amazon’s determination to bargain as much as possible over tax payments in the countries in which it operates and complaints from unions and workers about the labour pressures applied in its warehouses are also notorious, without forgetting its controversial use of the nature of freelance work. This is not the business model that European citizens and consumers want.
The competitive advantage of the United States and Asian e-commerce giants is so great and voracious that, if things continue like this, nearby business is practically doomed to disappear. And if these kinds of businesses are marginalised, something we are heading toward, cities lose and citizens lose. Less employment, less tax revenue, less tourist appeal, less diversity, less life on the streets.
We are, ultimately, facing a deeply unjust model that’s heading in a dangerous direction. That’s why we have decided to act, formally writing to the mayors of the cities on the continent to ask their residents, in the coming weeks, to support businesses in their city by not buying from the e-commerce giants. Other cities such as Paris, Grenoble, Poitiers and Barcelona, among many others, have already taken the step by asking their residents not to shop on Amazon.
Businesses, small and also large, bring the streets to life and provide employment to citizens. They reflect our way of life and, in the most significant cases, are part of our emotional heritage. Their owners pay taxes, the taxes we need to keep the streets clean and safe, offer sustainable and quality public transportation, provide social services to the most disadvantaged, etc.
The situation is critical, and the time is now. We need a clear commitment in defence of all local business and against predatory companies that contribute almost nothing in return. A more balanced model of transformation in e-commerce is needed, and the best tool we have to achieve this is our purchasing decisions.