One of the famous quotes by Amazon (AMZN) chief Jeff Bezos goes like this: What’s dangerous is not to evolve. True to the words of the world’s richest man, his company continues to evolve, even after achieving $1 trillion of valuation. The e-commerce giant set a new trend this week by announcing two new headquarters.
The move has raised the question of why a company like Amazon would need multiple headquarters, though many businesses already do so. People who have followed its growth strategy would know the answer – those at Amazon think differently. Deviating from the original plan, the management has decided to split the second headquarters into two parts. New York City, the country’s commercial capital, and Northern Virginia near Washington, the political hub, have been identified for setting up the twin headquarters.
The fact that Amazon’s business is more about technology than online retail justifies the decision to set up the $5-billion offices right in the center of the country, so that staff recruitment and customer service become easier. While achieving geographic diversity that is crucial to Amazon’s growth, the split will also save the company millions of dollars in living costs.
New York City and Northern Virginia, near Washington, have been identified for setting up the twin headquarters
What made Amazon’s HQ hunt special is the overwhelming response from local administrators seeking to consider their respective areas for the project, with the goal of taking advantage of the commercial benefits it offers. Amazon’s management was flooded with lucrative offers from the state authorities, such as huge tax cuts, free infrastructure and labor. The contenders might have taken a cue from Amazon’s claim of having contributed significantly to the economic growth of Seattle, where it is currently headquartered.
Amazon’s growing foothold in the non-retail areas of its business, especially cloud services, acts as a cushion against volatilities in the core business. The stability of market value thus guaranteed, combined with the possibilities offered by new ventures, is expected to unlock significant shareholder value in the coming months.
Amazon’s infra binge does not end with the twin headquarters, and the company will be opening its operations hub for East Coast in Tennessee soon. By having the new offices at strategically important locations, Bezos expects to invest in human resources more effectively and tap the best-in-class talent for various operations.
Amazon shares outperformed the market so far this year, gaining 34% since January. The stock opened Tuesday’s regular session higher and continued to gain as trading progressed.