Amazon's Plan to replace UPS & FedEx

http://www.businessinsider.com/amazon-secret-plan-replace-fe…

Amazon has been quietly beefing up its own shipping logistics network lately.

Although Amazon publicly says it’s meant to complement existing delivery partners like FedEx and UPS, a new report by The Wall Street Journal’s Greg Bensinger and Laura Stevens says Amazon has broader ambitions.

Eventually, Amazon aims to build a full-scale shipping and logistics network that will not only ship products ordered from Amazon, but also will ship products for other retailers and consumers.

In other words, Amazon is looking to compete against delivery services like FedEx and UPS, the report says. Internally, some Amazon execs call the plan “Consume the City.”

Here are other new details around Amazon’s logistics plan, according to the report:

Amazon recently hired former Uber VP Tim Collins as VP of global logistics.

It recruited dozens of UPS and FedEx executives and hundreds of UPS employees in recent years.

Test trials for last-mile deliveries are running in big cities like Los Angeles, Chicago, and Miami.

The company also experimented with a program called “I Have Space” to store Amazon’s inventory in warehouses owned by other companies.
On top of that, InternetRetailer.com recently reported that Amazon has hired Ed Feitzinger, the former CEO of UTi Worldwide, one of the largest supply chain management companies, as VP of global logistics. Add that to the fact that Amazon has now built facilities within 20 miles of 44% of the US population, and Amazon is starting to look like a real threat to existing logistics networks…

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Although Amazon publicly says it’s meant to complement existing delivery partners like FedEx and UPS, a new report by The Wall Street Journal’s Greg Bensinger and Laura Stevens says Amazon has broader ambitions.

During a comprehensive interview they asked Jeff Bezos why Amazon had been so successful when they started. Bezos said that in good measure it was because the infrastructure was already in place: optic fiber, the Internet, the WWW, browsers, credit cards, etc., etc. He said that it would have been impossible for them to get started without all that.

Does Bezos really want to bankrupt FedEx and UPS? I have my doubts. What he did say is that he would like better prices. I can see Bezos squeezing FedEx and UPS like Walmart and Dell squeezed their suppliers which is a different ball game.

Denny Schlesinger

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In my area the USPS now delivers many of the Amazon packages formally delivered by UPS. On Sundays too.
I am not sure how much of this is done with USPS for the last few
miles only. Whatever, it is a big change over the last couple of years.

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FedEx too. It is last few miles with the carrier delivering to the post office and the post office taking it from there. As long as the post office is making reasonable money on it, it makes a lot of sense since much of the time the PO is going to the address anyway. Only works for small parcels, of course.

The one downside is that one loses the predictable tracking of UPS and FedEx. I have seen reports of some very odd delays which clearly occur after the handoff.

In a more dystopian move, Amazon plans to replace your spouses. :wink:

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