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  • Amazon Is Launching Its Own Shipping Service To Fight FedEx And UPS

Amazon Is Launching Its Own Shipping Service To Fight FedEx And UPS

An employee stacks items to be shipped at the Amazon fulfillment center in Phoenix Amazon Is Launching Its Own Shipping Service To Fight FedEx And UPS
Debra Rodriguez | 06 October, 2017, 02:00

A report from Bloomberg News said that Amazon is testing a new delivery program known as "Seller Flex" in which the company picks up third-party seller packages being sold on its online platform and delivers them to the consumer.

Amazon didn't specifically deny the report but issued a statement to GeekWire in response to questions about the reported plans, saying "We are using the same carrier partners to offer this program that we've used for years, including UPS, USPS and FedEx". Amazon has already been using local couriers for same-day deliveries in major markets, and has been leaning more heavily on the U.S. Postal Service, including on Sundays. Customers may see their favorite third-party sellers jumping ship rather than be consumed by degrees by Amazon. When it comes to logistics, the science of getting stuff from point A to point B in the fastest, most efficient way possible, Amazon has changed how we ship in ways only a package company can really appreciate. Amazon would not comment about the project. The reason? Amazon CEO Jeff Bezos noted in the company's year-end earnings release that more than 50 million items are now eligible for free two-day shipping, an increase of 73 percent from the previous year. And with its latest actions, the company is getting closer to becoming a real challenger in two industries: delivery and apparel. By controlling the "last mile" of delivery, the company could save money through volume discounts and better control the inventory of its own warehouses that can solve supply chain problems especially around the holidays. That's why the fashion industry is just one among many on edge as it awaits Amazon's next move, especially since the e-commerce giant has made no secret of its apparel aspirations.

Amazon is constantly experimenting to shorten delivery times and reduce costs.

Amazon accounts for 5 percent to 10 percent of UPS revenue, according to analyst estimates, while FedEx has said the e-commerce giant accounts for less than 3 percent of its sales. Online holiday spending in the USA will hit $129 billion this year, up 12 percent from a year ago, according to Forrester Research Inc.

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