Amazon proves logistics are key to online sales
In the jockey between retailers, not only during the all-important holiday season, but well beyond the end of December, the battle of the giants usually comes down to Amazon, Target and Walmart. And a strategic weapon, more and more, is in logistics.
To that end, as PYMNTS reported on Monday (November 29), CNBC reported that Dave Clark, CEO of the global consumer e-commerce company, said the company would very soon become the largest delivery service to the states. -United.
“We predict that we will be one of the largest carriers in the world by the end of this year,” Clark told CNBC in an interview with “Squawk Box.” “I think we’ll probably be the largest parcel carrier in the United States by the end of the year, if not early 22.”
That would mean Amazon’s volume and market share of last mile deliveries would overtake FedEx, the U.S. Postal Service, and UPS.
Build the last mile
The change would come as Amazon takes more ownership of the products sold on its platform. As CNBC noted, the company delivered 66% of its own packages as of August of this year.
This growing share of deliveries comes as Amazon has, over several years, expanded its physical factory (as the item may be known from the company’s balance sheet) to include planes (the fleet is 85 planes at the time of writing. of this article) and trucks.
In doing so, the company manages to mitigate (at least somewhat) the unpredictable and rising freight costs that might result from using alternative carriers, and it also has better visibility into its supply chains.
As reported in this space as the holiday season approaches, Amazon said its infrastructure investments have positioned the company well to meet increased consumer demand.
Read more: Amazon unveils strategy to ensure fast holiday delivery
During those preparations, the company said at the time that it had increased the ports of entry on its network by 50%, doubled its container handling capacity and expanded its partnerships with its network of carriers from sea freight.
The continued moves come following the 2019 launch of the company’s digital freight platform, commonly known as Amazon Freight, which is said to have a pool of 50,000 trailers. At the same time, the Wall Street Journal noted that the company opened 450 new facilities across the United States to host and ship articles.
More details: Amazon strengthens its logistics strength with freight service
None of this is to say that competitors like Target and Walmart are sitting idly by. These companies have expanded their own delivery channels, with services such as Shipt in place. Walmart is in partnership with FedEx, but has its own fleet of thousands of tractors and trailers.
And, as PYMNTS noted in this space over the summer, Walmart unveiled GoLocal, a white-label delivery-as-a-service model that will serve customers and other merchants.
See Also: Walmart Launches GoLocal Last-Mile Delivery For Other Retailers
The battle will continue, but at a time when delivery windows are tightening – in hours, not days – the retail battle will be fought inch by inch, package by package, last mile by last mile. .