10 ms·

Amazon’s Shipping Empire Is Challenging UPS and FedEx

103 points by prostoalex 7y ago

dragonsh 7y ago
In any e-commerce business you have challenges like: 1. Getting traffic to online store. 2. Converting it to sales. 3. Able to deliver it to customers in time. 4. Service the complaints or product in time. Out of this website traffic is directly linked to assortment and sales is directly linked to price (value for money vis a vis quality) and delivery besides traffic. Logistics i.e. storing, sorting and last mile delivery is one of the toughest challenges to solve in this business. Amazon used UPS, FedEx and USPS in the beginning to help them understand how its done, acquire expertise. They took that knowledge and than applied technology to solve some of the challenges and reduce costs. It was just a matter of time they become full logistics company, because in reality every retailer and distributor is primarily a logistics company with stores, warehouses and distribution center. So it's hardly surprising they are competing with them. But I feel UPS, FedEx still do many other B2B supply chain work like delivering components to manufacturing site, vendor managed inventory, defence supplies, government supply chain, Olympics, major events and sports supply chain etc. so there will still be room for them to grow.
devoply 7y ago
I could see a future where Amazon does general shipping like FedEx as a side business to subsidize its real business.
- mcpherrinm 7y ago
  Much like AWS spun out of their in-house experience running flexible computing infrastructure, this would be a natural fit for them to flex their logistics strengths. Via their multi-channel fulfillment offerings, you can already use Amazon's logistics network to ship your products sold on or off of Amazon. This would just be supporting more type of shipments than just fulfillment. On the other hand, Fedex, DHL, UPS etc have built a big part of their strengths of shipping worldwide overnight. That's very different than what Amazon does, where they try to warehouse products close to customers to minimize shipping distance and time. Great when you want to buy an iPhone, but not suitable for shipping a document from New York City to Tokyo.
  - muddi900 7y ago
    Yeah, but most ecommerce operators have no incentive to use Amazon, because you are paying your competitor. There is a reason most grocery stores are shifting, or have already shifted to, Google or Microsoft for their cloud infrastructure.
    - bb611 7y ago
      It's a major issue with AWS across a bunch of sectors. I work at a large SaaS company transitioning to public cloud, the number of companies that contractually obligate us not to host on AWS is at least an order of magnitude higher than any other cloud provider.
    - blevo 7y ago
      >paying the competitor it's a good point, yet many still use Amazon/AWS regardless. Netflix, for instance (AWS). Then, on the micro-scale: FBA[0] sellers (Amazon Marketplace). I assume it has to do with the ultra low barrier to entry which Amazon/AWS provides. The convenience factor is off the charts. Nevertheless, I assume Netflix has ideations of following in Dropbox's footsteps.[1] [0] "Fulfilled by Amazon" [1] abandoning AWS for self-owned dedicated infrastructure
  - gumby 7y ago
    > Much like AWS spun out of their in-house experience running flexible computing infrastructure Actually that’s a myth (https://www.networkworld.com/article/2891297/the-myth-about-how-amazon-s-web-service-started-just-won-t-die.html https://www.networkworld.com/article/2891297/the-myth-about-... ). Oddly, unlike most corporate founding myths (e.g. eBay and Pez) it wasn’t invented by company marketing.
- Inconel 7y ago
  I believe this is what SWA, Shipping with Amazon, aims to do.
- thesuperbigfrog 7y ago
  "Transportation By Amazon" (TBA) has been a concept at Amazon since around 2010 or so. Originally the concept was that Amazon would accept shipments from business customers and inject those shipments into Amazon's sorting and shipping network using the rates negiotated with various carriers. Since most of Amazon's negiotated rates with carriers are lower than what carriers offer to consumers directly, customers get lower prices and would benefit from Amazon's scale and customer service. Now with Amazon's own transportation network finally taking off, Transportation By Amazon has gone from a concept that would have relied exclusively on third-party carriers (e.g. UPS, FedEx, USPS, etc.) to a likely reality with primary reliance on Amazon's infrastructure and supported by third-party carriers where Amazon does not have a robust prescence.
  - saltminer 7y ago
    Given how often I've had packages thrown haphazardly by Amazon drivers, I will gladly pay extra to have USPS handle my packages with slightly more care. It's an interesting idea, but their drivers are destroying their image before they've entered the market.
    - sturgill 7y ago
      Additionally, I have yet to ever have a driver ring the doorbell. They throw it at the house, mark it as complete, and trust that I’ll stumble across it later.
      - thesuperbigfrog 7y ago
        I would recommend signing up for the Amazon TextTrace delivery notifications. There is a prompt to sign up whenever you place an order. The notifications will send you a text message to your mobile phone or a push notification to the Amazon app on your smartphone as soon as your shipment gets delivered.
        sturgill 7y ago
        I don’t mind text notices, but it will always have a higher latency than ringing my doorbell. The best though is getting alerts about a delivery and then going on a scavenger hunt to find the package. Will it be on the front porch? Will it be tucked behind a bush? Maybe I left my garage door open so the driver helpfully left it there...
devilsenigma 7y ago
At some point is it possible that Amazon buys UPS or FedEx to boost its own fleet?
- tehlike 7y ago
  Fedex contracts out its deliveries. They are more like franchise. This is kind of what amazon is doing for the past few years.
  - walrus01 7y ago
    fedex ground drivers are contractors, fedex express are employees. fedex ground originated as a totally separate company that they acquired and re-branded. https://about.van.fedex.com/our-story/history-timeline/history/opco-ground/ https://about.van.fedex.com/our-story/history-timeline/histo...
    - tehwebguy 7y ago
      FedEx reps love to tell you they are "totally separate" when anything goes wrong with Ground, too
TazeTSchnitzel 7y ago
It's good for Amazon, but is it good for consumers? Isn't a postal service something of a natural monopoly — the more competing services there are, the less efficient each is, because instead of one vehicle with one load of deliveries, you have two or more vehicles with fractions of that amount? It's certainly not good for the environment at least.
- rerx 7y ago
  I feel delivery companies should bid for providing service for the last couple of kilometers, then the winner should get an exclusive contract for some time frame. That's how it's done for other services like regional rail public transport.
  - rerx 7y ago
    Did I hit a nerve by picking public transport as an example? If it does not work out, regulations are bad. Competing non cooperating infrastructure service providers are a bad idea if they hinder each other.
  - gruez 7y ago
    >That's how it's done for other services like regional rail public transport. Ask any Brit how privatized rail's working out for them.
    - rerx 7y ago
      Regional rail works okayish in Germany. A part of the regions and lines are carried by private business, others by the former monopolist that is still fully owned by the state.
  - Nasrudith 7y ago
    Why exclusive contract? What is gained? Rail right of way is exclusive just from geometry and there are various historical "accidents" involved in ownership from no longer relevant reasons but there are myraid ways to deliver mail which may or may not be excluding. A forced bidding system seems to give gameability and artifical barriers to entry for little gain. To give an anchhacic example of the sort of problems it would be akin to requiring a business that can serve all of New York City competively before bidding. Having a mail room in the lobby of a large apartment would violate that due to serving only residents.
deleted 7y ago
[deleted]
macintux 7y ago
Recent piece on the human costs of Prime’s next day delivery promise: https://www.buzzfeednews.com/article/carolineodonovan/amazon-next-day-delivery-deaths https://www.buzzfeednews.com/article/carolineodonovan/amazon...
- deleted 7y ago
  [deleted]
- balaksakrionon 7y ago
  interesting article, thanks for sharing it. I have been seeing more and more of these 3rd party contractor vans milling about and it makes since they're skimping on safety, etc. in order to get a piece of amazon's shipping needs, meanwhile amazon attempts to disclaim all liability while turning the screws and upping the pressure
  - lloyddobbler 7y ago
    Yep. The real question is how prevalent these "skimping on safety" companies are. When taken individually, no doubt it looks bad - but when considering that there are thousands of delivery partners, each having 20-500 trucks, delivering >5 million packages per day (per the article), I would expect to see a few incidents crop up. For example, it's reported that FedEx drivers were involved in 41 deaths in 24 months: > In the 24-month period prior to December 3, 2017, FedEx Express drivers were reported to have been involved in 1762 crashes, 575 involving injuries, including 41 deaths. https://www.frg-law.com/carriers/fedex/ https://www.frg-law.com/carriers/fedex/ The big question is just how much Amazon is applying pressure and causing those sorts of issues, and are they outside of the normal expected incidents for logistics companies? WRT the Amazon delivery network, is this a matter of a few bad apple operators trying to squeeze every cent of profit by overworking drivers and not deploying more vans? Or is it a case of systemic unattainable expectations from Amazon that force every delivery partner to cut corners so they can maintain a livable profit margin? Difficult to say from this article...but in spite of the sensationalism, the examples it recounts certainly aren't good.
- riffic 7y ago
Shivetya 7y ago
I just find it amazing that Amazon found it more profitable to buy tens of thousands of delivery vehicles and build a service from the ground up than to find better deals through the available shippers. Now I see their trucks nearly as often as Fed Ex and UPS.
- jpalomaki 7y ago
  Maybe they see value also in being able to fully control the customer experience. Your trusted Amazon delivery guy could fill your fridge while you supervise him through Amazon branded devices.
  - ulfw 7y ago
    There is no trusted Amazon delivery guy. It's independent contractors mostly.
    - nacs 7y ago
      False, there are lots of last-mile Amazon delivery guys -- I live by a distribution center that has literally hundreds of Amazon-branded last-mile vans that deliver straight to my house. The program you're thinking of is likely "Amazon Flex" which is just part of their last-mile delivery system and uses independent contractors.
      - johnbrodie 7y ago
        Those aren't necessarily employees of Amazon, you can sign up to be a shipper and buy the vans. https://logistics.amazon.com/marketing/opportunity https://logistics.amazon.com/marketing/opportunity
- drevil-v2 7y ago
  Most of their fleet is private contractors who supply their own vehicles. Minimal capital investment for Amazon
  - 7y ago
dasanman 7y ago
Amazon is becoming the real Evil Corp!
gumby 7y ago
Ronald Coase would have loved Amazon and in particular this case. Amazon is quite unconventional in regards to what they choose to outsource and what they keep — or bring — in house.
adinobro 7y ago
What is interesting is that an American company is copying Chinese companies after pulling out of China because they could not compete with the local companies. Both JD & Taobao/Tmall have their own large shipping empires in China. I suspect that was part of the reason they pulled out. They could not compete using 3rd part shipping companies. Now they are doing the same thing in their home market.
- deleted 7y ago
  [deleted]
- Someone1234 7y ago
  But Amazon started logistical services before some of those companies even existed. Seems like a creative re-write of history.
  - adinobro 7y ago
    When did Amazon start logistics? I know for a fact that Taobao/TMall was doing it in 2012. There was a distribution hub at the end of my street. I assume they had been doing it a few years before then but not 100% sure when they started. You are correct JD didn't exist back then since it used to be called 360buy and they used 3rd party shipping companies. After becoming JD they started shipping themselves. Not sure about the year. Probably right about JD but as far as I know Amazon didn't start doing logistics till after 2013. Am I wrong about the dates?
- dragonsh 7y ago
  JD has its deliver and warehouse and still use network of delivery companies and warehouse too. Tmall and Taobao use a network of delivery companies their own logistics arm Cainiao is not that big in warehousing and last mile delivery like SF Express or YTO. In reality logistics is capital and labor intensive industry, Amazon will have trouble once the retail growth flatten but the cost structures are high. Amazon once unionized will have similar challenges and costs like UPS. This is the reason FedEx never want to be unionized.
  - 7y ago
dmoy 7y ago
Huh, missing from this article is the thousand or so DSP that service Amazon for shipping, basically contracting companies. A lot of Amazon shipping is actually Amazon corporate, but a huge chunk is a thousand smaller shops. Turns out you can also contract with those shops as a private citizen to just ship random heavy stuff anywhere for super cheap. Because Amazon gives them enough volume, it's become cheaper for individuals to make their own shipping purchases too. Strange side effect. I don't work for Amazon or anything, but my dad has used one of their DSP to ship some truly heavy stuff (250kg+). Is all that in the "other"? Or did it get lumped in with Amazon's chunk? I want to know but the article doesn't help.
- blevo 7y ago
  >"strange side-effect" reminds me of McDonald's single-handedly bringing down the price of beef
- Stratoscope 7y ago
  > DSP Just so I don't misunderstand, does that stand for Delivery Service Provider?
  - lloyddobbler 7y ago
    "Delivery Service Partner"
miker64 7y ago
Both UPS and FedEx deliveries arrive at my front door in good condition, the delivery drivers bag the packages up if I'm not home and it looks like rain. USPS consistently rings my doorbell and makes sure packages are handed to me rather than left outside. Amazon delivered packages have been: thrown from the street; arrive crushed, punctured, or otherwise damaged; left in the driveway; left in the neighbors yard; never ring the doorbell, unless it's after dark, and then they ring and run. Amazon's last mile service is a complete shit show, impressively worse than the random cut rate last mile delivery services they used when they were trying to force UPS and FedEx to lower prices.
- blevo 7y ago
  I think service for any of these companies is highly variable and dependent upon locale. Perhaps it's a culture thing. The USPS worker never rings my doorbell for left packages and just yesterday a package was delivered damaged in my mailbox. I live in a nice part of town (I think) but the service culture here may be different than where you live (and different than other locales where I've resided).
  - sib 7y ago
    Completely agree. Multiple times I've had USPS drivers report packages as "delivered" late in the day when they were not delivered at all, then they are actually delivered the next day. Sure makes their metrics look better, though.
- linuxftw 7y ago
  You're being downvoted, but you're not wrong. Amazon's deliver is terrible for me as well, never had a problem with UPS or FedEx (USPS is slightly less reliable, but still WAY better than Amazon).
- bloopernova 7y ago
  Any packages from Amazon that have been delivered by its independent contractor delivery people have always been photographed sitting by my front door. Do yours not take photos?
PorterDuff 7y ago
I suppose that Amazon, at least the retail sales part of it, is essentially a shipping company. No surprise that it would build out over time, plus you'd be silly to trust them as a single huge customer. One sentence in that article that I like was mentioning Amazon purchasing of dead malls. I had to thump myself in the head..'of course'. I've always wondered what would happen to those facilities and mini storage and fulfillment centers are good ideas. Maybe we could ship Amazon direct to mini storage and cut out the middle man. Making 'too much stuff' more efficient seems like a genuine plan.
linuxftw 7y ago
The people that deliver in those amazon vans to my place are clowns. Next-day and two-day delivery is no longer reliable. It's making me not want to shop with amazon.

103 points by prostoalex 7y ago

In any e-commerce business you have challenges like: 1. Getting traffic to online store. 2. Converting it to sales. 3. Able to deliver it to customers in time. 4. Service the complaints or product in time. Out of this website traffic is directly linked to assortment and sales is directly linked to price (value for money vis a vis quality) and delivery besides traffic. Logistics i.e. storing, sorting and last mile delivery is one of the toughest challenges to solve in this business. Amazon used UPS, FedEx and USPS in the beginning to help them understand how its done, acquire expertise. They took that knowledge and than applied technology to solve some of the challenges and reduce costs. It was just a matter of time they become full logistics company, because in reality every retailer and distributor is primarily a logistics company with stores, warehouses and distribution center. So it's hardly surprising they are competing with them. But I feel UPS, FedEx still do many other B2B supply chain work like delivering components to manufacturing site, vendor managed inventory, defence supplies, government supply chain, Olympics, major events and sports supply chain etc. so there will still be room for them to grow.

devoply 7y ago

I could see a future where Amazon does general shipping like FedEx as a side business to subsidize its real business.

mcpherrinm 7y ago
Much like AWS spun out of their in-house experience running flexible computing infrastructure, this would be a natural fit for them to flex their logistics strengths. Via their multi-channel fulfillment offerings, you can already use Amazon's logistics network to ship your products sold on or off of Amazon. This would just be supporting more type of shipments than just fulfillment. On the other hand, Fedex, DHL, UPS etc have built a big part of their strengths of shipping worldwide overnight. That's very different than what Amazon does, where they try to warehouse products close to customers to minimize shipping distance and time. Great when you want to buy an iPhone, but not suitable for shipping a document from New York City to Tokyo.
- muddi900 7y ago
  Yeah, but most ecommerce operators have no incentive to use Amazon, because you are paying your competitor. There is a reason most grocery stores are shifting, or have already shifted to, Google or Microsoft for their cloud infrastructure.
  - bb611 7y ago
    It's a major issue with AWS across a bunch of sectors. I work at a large SaaS company transitioning to public cloud, the number of companies that contractually obligate us not to host on AWS is at least an order of magnitude higher than any other cloud provider.
  - blevo 7y ago
    >paying the competitor it's a good point, yet many still use Amazon/AWS regardless. Netflix, for instance (AWS). Then, on the micro-scale: FBA[0] sellers (Amazon Marketplace). I assume it has to do with the ultra low barrier to entry which Amazon/AWS provides. The convenience factor is off the charts. Nevertheless, I assume Netflix has ideations of following in Dropbox's footsteps.[1] [0] "Fulfilled by Amazon" [1] abandoning AWS for self-owned dedicated infrastructure
- gumby 7y ago
  > Much like AWS spun out of their in-house experience running flexible computing infrastructure Actually that’s a myth (https://www.networkworld.com/article/2891297/the-myth-about-how-amazon-s-web-service-started-just-won-t-die.html https://www.networkworld.com/article/2891297/the-myth-about-... ). Oddly, unlike most corporate founding myths (e.g. eBay and Pez) it wasn’t invented by company marketing.
Inconel 7y ago
I believe this is what SWA, Shipping with Amazon, aims to do.
thesuperbigfrog 7y ago
"Transportation By Amazon" (TBA) has been a concept at Amazon since around 2010 or so. Originally the concept was that Amazon would accept shipments from business customers and inject those shipments into Amazon's sorting and shipping network using the rates negiotated with various carriers. Since most of Amazon's negiotated rates with carriers are lower than what carriers offer to consumers directly, customers get lower prices and would benefit from Amazon's scale and customer service. Now with Amazon's own transportation network finally taking off, Transportation By Amazon has gone from a concept that would have relied exclusively on third-party carriers (e.g. UPS, FedEx, USPS, etc.) to a likely reality with primary reliance on Amazon's infrastructure and supported by third-party carriers where Amazon does not have a robust prescence.
- saltminer 7y ago
  Given how often I've had packages thrown haphazardly by Amazon drivers, I will gladly pay extra to have USPS handle my packages with slightly more care. It's an interesting idea, but their drivers are destroying their image before they've entered the market.
  - sturgill 7y ago
    Additionally, I have yet to ever have a driver ring the doorbell. They throw it at the house, mark it as complete, and trust that I’ll stumble across it later.
    - thesuperbigfrog 7y ago
      I would recommend signing up for the Amazon TextTrace delivery notifications. There is a prompt to sign up whenever you place an order. The notifications will send you a text message to your mobile phone or a push notification to the Amazon app on your smartphone as soon as your shipment gets delivered.
      - sturgill 7y ago
        I don’t mind text notices, but it will always have a higher latency than ringing my doorbell. The best though is getting alerts about a delivery and then going on a scavenger hunt to find the package. Will it be on the front porch? Will it be tucked behind a bush? Maybe I left my garage door open so the driver helpfully left it there...

devilsenigma 7y ago

At some point is it possible that Amazon buys UPS or FedEx to boost its own fleet?

tehlike 7y ago
Fedex contracts out its deliveries. They are more like franchise. This is kind of what amazon is doing for the past few years.
- walrus01 7y ago
  fedex ground drivers are contractors, fedex express are employees. fedex ground originated as a totally separate company that they acquired and re-branded. https://about.van.fedex.com/our-story/history-timeline/history/opco-ground/ https://about.van.fedex.com/our-story/history-timeline/histo...
  - tehwebguy 7y ago
    FedEx reps love to tell you they are "totally separate" when anything goes wrong with Ground, too

TazeTSchnitzel 7y ago

It's good for Amazon, but is it good for consumers? Isn't a postal service something of a natural monopoly — the more competing services there are, the less efficient each is, because instead of one vehicle with one load of deliveries, you have two or more vehicles with fractions of that amount? It's certainly not good for the environment at least.

rerx 7y ago
I feel delivery companies should bid for providing service for the last couple of kilometers, then the winner should get an exclusive contract for some time frame. That's how it's done for other services like regional rail public transport.
- rerx 7y ago
  Did I hit a nerve by picking public transport as an example? If it does not work out, regulations are bad. Competing non cooperating infrastructure service providers are a bad idea if they hinder each other.
- gruez 7y ago
  >That's how it's done for other services like regional rail public transport. Ask any Brit how privatized rail's working out for them.
  - rerx 7y ago
    Regional rail works okayish in Germany. A part of the regions and lines are carried by private business, others by the former monopolist that is still fully owned by the state.
- Nasrudith 7y ago
  Why exclusive contract? What is gained? Rail right of way is exclusive just from geometry and there are various historical "accidents" involved in ownership from no longer relevant reasons but there are myraid ways to deliver mail which may or may not be excluding. A forced bidding system seems to give gameability and artifical barriers to entry for little gain. To give an anchhacic example of the sort of problems it would be akin to requiring a business that can serve all of New York City competively before bidding. Having a mail room in the lobby of a large apartment would violate that due to serving only residents.

deleted 7y ago

[deleted]

macintux 7y ago

Recent piece on the human costs of Prime’s next day delivery promise: https://www.buzzfeednews.com/article/carolineodonovan/amazon-next-day-delivery-deaths https://www.buzzfeednews.com/article/carolineodonovan/amazon...

deleted 7y ago
[deleted]
balaksakrionon 7y ago
interesting article, thanks for sharing it. I have been seeing more and more of these 3rd party contractor vans milling about and it makes since they're skimping on safety, etc. in order to get a piece of amazon's shipping needs, meanwhile amazon attempts to disclaim all liability while turning the screws and upping the pressure
- lloyddobbler 7y ago
  Yep. The real question is how prevalent these "skimping on safety" companies are. When taken individually, no doubt it looks bad - but when considering that there are thousands of delivery partners, each having 20-500 trucks, delivering >5 million packages per day (per the article), I would expect to see a few incidents crop up. For example, it's reported that FedEx drivers were involved in 41 deaths in 24 months: > In the 24-month period prior to December 3, 2017, FedEx Express drivers were reported to have been involved in 1762 crashes, 575 involving injuries, including 41 deaths. https://www.frg-law.com/carriers/fedex/ https://www.frg-law.com/carriers/fedex/ The big question is just how much Amazon is applying pressure and causing those sorts of issues, and are they outside of the normal expected incidents for logistics companies? WRT the Amazon delivery network, is this a matter of a few bad apple operators trying to squeeze every cent of profit by overworking drivers and not deploying more vans? Or is it a case of systemic unattainable expectations from Amazon that force every delivery partner to cut corners so they can maintain a livable profit margin? Difficult to say from this article...but in spite of the sensationalism, the examples it recounts certainly aren't good.
riffic 7y ago

Shivetya 7y ago

I just find it amazing that Amazon found it more profitable to buy tens of thousands of delivery vehicles and build a service from the ground up than to find better deals through the available shippers. Now I see their trucks nearly as often as Fed Ex and UPS.

jpalomaki 7y ago
Maybe they see value also in being able to fully control the customer experience. Your trusted Amazon delivery guy could fill your fridge while you supervise him through Amazon branded devices.
- ulfw 7y ago
  There is no trusted Amazon delivery guy. It's independent contractors mostly.
  - nacs 7y ago
    False, there are lots of last-mile Amazon delivery guys -- I live by a distribution center that has literally hundreds of Amazon-branded last-mile vans that deliver straight to my house. The program you're thinking of is likely "Amazon Flex" which is just part of their last-mile delivery system and uses independent contractors.
    - johnbrodie 7y ago
      Those aren't necessarily employees of Amazon, you can sign up to be a shipper and buy the vans. https://logistics.amazon.com/marketing/opportunity https://logistics.amazon.com/marketing/opportunity
drevil-v2 7y ago
Most of their fleet is private contractors who supply their own vehicles. Minimal capital investment for Amazon
- 7y ago

dasanman 7y ago

Amazon is becoming the real Evil Corp!

gumby 7y ago

Ronald Coase would have loved Amazon and in particular this case. Amazon is quite unconventional in regards to what they choose to outsource and what they keep — or bring — in house.

adinobro 7y ago

What is interesting is that an American company is copying Chinese companies after pulling out of China because they could not compete with the local companies. Both JD & Taobao/Tmall have their own large shipping empires in China. I suspect that was part of the reason they pulled out. They could not compete using 3rd part shipping companies. Now they are doing the same thing in their home market.

deleted 7y ago
[deleted]
Someone1234 7y ago
But Amazon started logistical services before some of those companies even existed. Seems like a creative re-write of history.
- adinobro 7y ago
  When did Amazon start logistics? I know for a fact that Taobao/TMall was doing it in 2012. There was a distribution hub at the end of my street. I assume they had been doing it a few years before then but not 100% sure when they started. You are correct JD didn't exist back then since it used to be called 360buy and they used 3rd party shipping companies. After becoming JD they started shipping themselves. Not sure about the year. Probably right about JD but as far as I know Amazon didn't start doing logistics till after 2013. Am I wrong about the dates?
dragonsh 7y ago
JD has its deliver and warehouse and still use network of delivery companies and warehouse too. Tmall and Taobao use a network of delivery companies their own logistics arm Cainiao is not that big in warehousing and last mile delivery like SF Express or YTO. In reality logistics is capital and labor intensive industry, Amazon will have trouble once the retail growth flatten but the cost structures are high. Amazon once unionized will have similar challenges and costs like UPS. This is the reason FedEx never want to be unionized.
- 7y ago

dmoy 7y ago

Huh, missing from this article is the thousand or so DSP that service Amazon for shipping, basically contracting companies. A lot of Amazon shipping is actually Amazon corporate, but a huge chunk is a thousand smaller shops. Turns out you can also contract with those shops as a private citizen to just ship random heavy stuff anywhere for super cheap. Because Amazon gives them enough volume, it's become cheaper for individuals to make their own shipping purchases too. Strange side effect. I don't work for Amazon or anything, but my dad has used one of their DSP to ship some truly heavy stuff (250kg+). Is all that in the "other"? Or did it get lumped in with Amazon's chunk? I want to know but the article doesn't help.

blevo 7y ago
>"strange side-effect" reminds me of McDonald's single-handedly bringing down the price of beef
Stratoscope 7y ago
> DSP Just so I don't misunderstand, does that stand for Delivery Service Provider?
- lloyddobbler 7y ago
  "Delivery Service Partner"

miker64 7y ago

Both UPS and FedEx deliveries arrive at my front door in good condition, the delivery drivers bag the packages up if I'm not home and it looks like rain. USPS consistently rings my doorbell and makes sure packages are handed to me rather than left outside. Amazon delivered packages have been: thrown from the street; arrive crushed, punctured, or otherwise damaged; left in the driveway; left in the neighbors yard; never ring the doorbell, unless it's after dark, and then they ring and run. Amazon's last mile service is a complete shit show, impressively worse than the random cut rate last mile delivery services they used when they were trying to force UPS and FedEx to lower prices.

blevo 7y ago
I think service for any of these companies is highly variable and dependent upon locale. Perhaps it's a culture thing. The USPS worker never rings my doorbell for left packages and just yesterday a package was delivered damaged in my mailbox. I live in a nice part of town (I think) but the service culture here may be different than where you live (and different than other locales where I've resided).
- sib 7y ago
  Completely agree. Multiple times I've had USPS drivers report packages as "delivered" late in the day when they were not delivered at all, then they are actually delivered the next day. Sure makes their metrics look better, though.
linuxftw 7y ago
You're being downvoted, but you're not wrong. Amazon's deliver is terrible for me as well, never had a problem with UPS or FedEx (USPS is slightly less reliable, but still WAY better than Amazon).
bloopernova 7y ago
Any packages from Amazon that have been delivered by its independent contractor delivery people have always been photographed sitting by my front door. Do yours not take photos?

PorterDuff 7y ago

I suppose that Amazon, at least the retail sales part of it, is essentially a shipping company. No surprise that it would build out over time, plus you'd be silly to trust them as a single huge customer. One sentence in that article that I like was mentioning Amazon purchasing of dead malls. I had to thump myself in the head..'of course'. I've always wondered what would happen to those facilities and mini storage and fulfillment centers are good ideas. Maybe we could ship Amazon direct to mini storage and cut out the middle man. Making 'too much stuff' more efficient seems like a genuine plan.

linuxftw 7y ago

The people that deliver in those amazon vans to my place are clowns. Next-day and two-day delivery is no longer reliable. It's making me not want to shop with amazon.