3 ms·

> Traditional carriers break even or even take a small loss on a percentage of deliveries because it's important to their business model to have consistent pric

> Traditional carriers break even or even take a small loss on a percentage of deliveries because it's important to their business model to have consistent prices and deliver everywhere. Maybe that's the case for the average walk-in, but at scale all of these terms are subject to negotiation.

siculars 6y ago
This. Op seems to suggest pricing is fixed when shipping for Amazon. Without any knowledge I would be surprised if it was. In fact 3rd party shippers can charge whatever they want to deliver Amazon packages because until Amazon can deliver all their packages they need shipping partners.
- luckylion 6y ago
  If I recall correctly, DHL (Germany's largest delivery company, part of the former state post system) charges Amazon ~2 euros, while the end user price is between 5 and 6 euros. It's common wisdom that most of the cost for delivery is in the last mile. Amazon has great leverage, because DHL certainly isn't making money on their deliveries - the intake scales with Amazon's large quantities, but the individual delivery does not. It's a race to the bottom between the delivery companies, fueled mostly by sub-sub-contractors with very low wages, long hours and bad conditions. DHL has seen giant growth, but profits are falling apart.
  - nerfhammer 6y ago
    it's the other way around, Deutsche Post bought DHL, which had been a private US company.
    - luckylion 6y ago
      Thanks, I wasn't aware of that. The outcome is the same, as they just rebranded the Deutsche Post operations to run as DHL in Germany, and the original Post employees are working at DHL with (pretty much) the same contracts (which DHL cites as a disadvantage, because the former state employees draw significantly higher salaries; they're beeing replace with sub-contractors where possible).
  - majewsky 6y ago
    > DHL [in Germany] charges Amazon ~2 euros, while the end user price is between 5 and 6 euros. Up to a certain point [1], that's actually reasonable. Amazon drops off entire truckloads at a time, whereas end users hand packages over individually at shops that have to pay staff and rent. So the cost of just accepting parcel is going to be higher for packages sent by end users. Side note: If I were DHL, I'd be giving Amazon a discount for packages that are addressed to a Packstation, since that cuts down on the other big cost center, the cost of delivering parcel on the last mile. [1] I'm not arguing that this is the difference between 2 and 5-6 euros, but it's certainly a large part of it.
    - luckylion 6y ago
      Absolutely, some rebate makes sense, Amazon delivers them well-wrapped, in a few sane package sizes etc, the hand-over scales well. The delivery on the last mile does not, and that's supposedly 50% of costs. I'd be surprised if Amazon does not enjoy additional rebates for Packstation deliveries.
ogre_codes 6y ago
> Maybe that's the case for the average walk-in, but at scale all of these terms are subject to negotiation. I'm sure could, but prior to Amazon, having a fairly flat rate table has been a selling point for carriers even to their larger customers.

siculars 6y ago

This. Op seems to suggest pricing is fixed when shipping for Amazon. Without any knowledge I would be surprised if it was. In fact 3rd party shippers can charge whatever they want to deliver Amazon packages because until Amazon can deliver all their packages they need shipping partners.

luckylion 6y ago
If I recall correctly, DHL (Germany's largest delivery company, part of the former state post system) charges Amazon ~2 euros, while the end user price is between 5 and 6 euros. It's common wisdom that most of the cost for delivery is in the last mile. Amazon has great leverage, because DHL certainly isn't making money on their deliveries - the intake scales with Amazon's large quantities, but the individual delivery does not. It's a race to the bottom between the delivery companies, fueled mostly by sub-sub-contractors with very low wages, long hours and bad conditions. DHL has seen giant growth, but profits are falling apart.
- nerfhammer 6y ago
  it's the other way around, Deutsche Post bought DHL, which had been a private US company.
  - luckylion 6y ago
    Thanks, I wasn't aware of that. The outcome is the same, as they just rebranded the Deutsche Post operations to run as DHL in Germany, and the original Post employees are working at DHL with (pretty much) the same contracts (which DHL cites as a disadvantage, because the former state employees draw significantly higher salaries; they're beeing replace with sub-contractors where possible).
- majewsky 6y ago
  > DHL [in Germany] charges Amazon ~2 euros, while the end user price is between 5 and 6 euros. Up to a certain point [1], that's actually reasonable. Amazon drops off entire truckloads at a time, whereas end users hand packages over individually at shops that have to pay staff and rent. So the cost of just accepting parcel is going to be higher for packages sent by end users. Side note: If I were DHL, I'd be giving Amazon a discount for packages that are addressed to a Packstation, since that cuts down on the other big cost center, the cost of delivering parcel on the last mile. [1] I'm not arguing that this is the difference between 2 and 5-6 euros, but it's certainly a large part of it.
  - luckylion 6y ago
    Absolutely, some rebate makes sense, Amazon delivers them well-wrapped, in a few sane package sizes etc, the hand-over scales well. The delivery on the last mile does not, and that's supposedly 50% of costs. I'd be surprised if Amazon does not enjoy additional rebates for Packstation deliveries.

ogre_codes 6y ago

> Maybe that's the case for the average walk-in, but at scale all of these terms are subject to negotiation. I'm sure could, but prior to Amazon, having a fairly flat rate table has been a selling point for carriers even to their larger customers.