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Our company gets a 65% discount off retail from FedEx, and I'm sure Amazon gets a much better deal than that. The savings would probably no more than cover the fixed cost for a net benefit of zero.
UPS and FedEx are massive operations. They would never get sold to Amazon.
Amazon could expand to deliver there own goods, but I don't think the savings would be enough to justify expanding operations into a segment that they are unfamiliar with. Not to mention that there would be a huge backlash. Amazon exclusively hires cheap labor for non IT/business operations roles. If they tried to undercut UPS/FedEx, who pay fair wages to their employees, there is a large potential for backlash from the general public.
There is no doubt in my mind Amazon will develop its own delivery service. They continue to add fulfillment warehouses every quarter. It won't be long to where next day delivery will be standard for Amazon orders. Once that becomes a reality, so will deliveries in Amazon trucks. UPS, FedEx, and USPS will still be used by Amazon, but on a much smaller scale.
There is no doubt in my mind Amazon will develop its own delivery service. They continue to add fulfillment warehouses every quarter. It won't be long to where next day delivery will be standard for Amazon orders. Once that becomes a reality, so will deliveries in Amazon trucks. UPS, FedEx, and USPS will still be used by Amazon, but on a much smaller scale.
You have that backwards. They will still use ups, FedEx and usps but their own delivery service on a much smaller scale. Their warehouse footprint won't cover nearly enough of the US
We get same day and Sunday delivery here in DFW courtesy of the USPS agreement with Amazon.
You have to compare the cost to farm out delivery vs operating your own delivery. The current system actually gives Amazon more flexibility through multiple delivery sources and the ability to negotiate rates, etc.
Why not form a business relationship with the USPS? I'm not sure what that might look like - possibly exclusivity rights to ship. It could potentially pull the USPS out of its hole and create a "beck and call" provider for Amazon.
Again, not a full fleshed out thought just thinking out loud more or less.
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