During years Amazon has downplayed its ambitions to be a major logistics operatorclaiming that its own delivery service was only intended to be performed by its current partners such as UPS and But that has changed forever.
Amazon has potentially increased its logistics service
In fact, even logistics companies had downplayed Amazon’s dabbling in logistics. The same executive president of FedEx assured last year that he did not view Amazon “as an equal competitor.”
However, last week David Abny, CEO of UPS, finally admitted the competitive threat posed by Amazon and its logistics system during an interview with: “We monitor them as if they were a competitor”.
And it is that quietly, the retail giant has stopped depending on its logistics partners. Amazon’s services as a logistics operator began four years ago in India and little by little it has introduced it in different markets.
In fact, a couple of years ago it started testing , a parcel service with which you can take the products directly from their warehouses to their customers without going through any intermediary.
This system complements the service, with which vendors can store and ship their items in the logistics centers of the retail giant, which has been so successful that it has already in 2017 it managed to deliver more than 1,000 million products worldwide.
It’s official: Amazon is considered one more logistics operator
But the time has come to break the silence, and Amazon has made it clear that they consider themselves just another logistics operator.and that its former partners are (such as FedEx, UPS, and other package and logistics companies), in fact, its competitors.
In its presentation last week, Amazon highlighted the intense competition in different sectors and markets in which it has a presence. Some of these sectors, such as the , the and the , are which we usually associate with the company.
But within its regulatory filings this year, Amazon made a novelty: “Transportation and logistics services” with which it considers itself a full-fledged logistics operator:
“Our businesses are rapidly evolving and intensely competitive, as we have many competitors in many different industries, including retail, eCommerce and omnichannel, digital content and electronic devices, computing services, and logistics and transportation services including cross-border services”, Amazon assured in its presentation.
With its logistics service, Amazon will have control of its sellers and lower its costs
But what does this statement mean? With this, the retail giant wants demonstrate its growing importance as a logistics operator and that it should be considered a serious competitor to the big delivery and logistics providers.
During the last years, Amazon has significantly strengthened its logistics footprintby renting and thousands of to control part of its enormous amount of shipments.
This idea has been around for many years. In fact since 2013 when one took the company by surprise, forcing it to return money to consumers that they did not receive their packages in the promised time.
This showed him the danger of depending too much on third parties to achieve its promise of “fast and reliable deliveries”. In fact, so fast that on some occasions they become … or less.
Shipping continues to be one of Amazon’s biggest expenses. representing in 2018. Having more internal shipments will help keep this expense under control, despite the company still officially downplaying its efforts.
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