Key Points
- Amazon Shipping Returns: Amazon relaunches its Amazon Shipping service, competing directly with FedEx and UPS in the external delivery market, after pausing during the pandemic.
- Speed and Sustainability: Amazon’s renewed focus includes speeding up delivery by placing packages closer to customers, and a drive to minimize excess packaging to meet sustainability goals.
Amazon.com has revived its external shipping service, Amazon Shipping, after pausing it during the Covid-19 pandemic. This move puts the company in direct competition with FedEx and United Parcel Service. The service, which covers the contiguous U.S., caters to packages from Amazon’s own website as well as those from other sources. Eligibility requires businesses to sell on Amazon’s platform.
During the pandemic, Amazon experienced a surge in demand and expanded its logistics operations significantly. However, it later faced excess capacity in its network. This led to subletting warehouse space and a restructuring of delivery systems. As Amazon recovered, it aimed to enhance delivery speed and proximity to customers. The creation of more same-day delivery centers facilitated orders reaching customers within a day.
Furthermore, Amazon sought to innovate its packaging methods, with plans to minimize extra packaging waste. This approach aligns with the company’s commitment to environmental goals and appeals to eco-conscious customers. In previous years, Amazon had been heavily reliant on UPS and FedEx, but it progressively built its shipping network, including warehouses, vehicles, planes, and trucks. In 2018, Amazon Shipping was launched, and a year later, the company ended its shipping contract with FedEx due to competitive concerns.
The pandemic prompted Amazon to halt Amazon Shipping as order volumes soared during lockdowns. The service has now reopened to sellers, offering a quick and cost-effective way to ship packages. According to Amazon spokeswoman Olivia Connors, this option supports the company’s selling partners by providing innovative solutions.
Logistics remains a key focus for Amazon, with CEO Andy Jassy emphasizing its importance in the company’s retail operations and customer interactions. Efforts to optimize logistics include strategically positioning packages nearer to customers and establishing more same-day delivery centers. Alongside these measures, Amazon is looking to reduce excessive packaging to maintain its market dominance, cater to packaging-conscious customers, and meet sustainability objectives.
Despite not maintaining its previous rapid growth rate, Amazon’s recent financial report indicates recovery and resilience in its e-commerce sector. Second-quarter revenue reached $134.2 billion, an almost 11% increase, surpassing analyst predictions. The company foresees a comparable pace of expansion in the following quarter, reflecting its rebound from recent challenges.
