Amazon Streamlines Deliveries: Bypassing Intermediaries for Swift Deliveries!
Amazon, the world's leading online retailer, announced the launch of its own delivery service, "Shipping With Amazon," in February 2018. This strategic move aligns with forward-thinking supply chain operations and aims to extend Amazon's control over the customer experience.
The new service is designed to optimize the last mile of delivery, a critical aspect of the overall customer experience. By handling delivery itself, Amazon aims to improve efficiency, eliminate duplicate handling, and increase delivery speed.
Shipping With Amazon serves to cut out the middle man in the supply chain, aiming to reduce costs and move into higher margin businesses. Amazon's shipping costs have far exceeded shipping revenue for a long time, and this initiative is a step towards addressing that issue.
Amazon's logistics infrastructure, while smaller than FedEx or UPS, includes distribution centres, trucks, lockers, last-mile contract couriers, Amazon Key service, and Amazon Go retail stores. The company's expansion into logistics is consistent with its strategy of creating disruption and the Amazon Flywheel effect.
The new service competes with logistics service providers like UPS, FedEx, and UPS. However, Amazon represents only 3% of FedEx's revenue and 10% of UPS' revenue, indicating that there is room for Amazon to make a significant impact in the logistics space.
The objectives of Shipping With Amazon include improving efficiencies, eliminating waste, and lowering costs. By increasing delivery capacity and reducing its reliance on third parties, Amazon aims to provide a more seamless and reliable delivery experience for its customers.
This strategy has the potential to create disruption and dominance in the logistics space. As Amazon continues to innovate and improve its delivery services, it is poised to redefine the way goods are delivered to customers worldwide, consistent with the Amazon Flywheel effect.
In preserving and building customer trust as a one-stop shop, Amazon's goal with Shipping With Amazon is to provide a more integrated and streamlined shopping experience for its customers. This move further solidifies Amazon's position as a leader in the e-commerce industry and positions it for continued growth and success in the years to come.
