Shouldn't Amazon just buy UPS and make it official? Aren't both companies so dependent on the other that they are essentially one?
Business smart guys tell me how I'm wrong.
Shouldn't Amazon just buy UPS and make it official? Aren't both companies so dependent on the other that they are essentially one?
Business smart guys tell me how I'm wrong.
USPS, too.
My wife had an Amazon package delivered on Easter Sunday. By a US Mail carrier.
Amazon is certainly an important customer of UPS, but not as large as you might expect. According to the UPS 2018 Annual Report (p. 10 on the 10K):
No single customer accounts for 10% or more of our consolidated revenue. We do not believe the loss of any single
customer would materially impair our overall financial condition or results of operations; however, collectively, some of our
large customers might account for a relatively significant portion of the growth in revenue in a particular quarter or year.
It is estimated that Amazon is likely responsible for 5-10% of UPS sales. That is substantial and certainly gives them a lot of bargaining power. Buy, Amazon utilizes FedEx and USPS nearly as much as UPS. Which service they use to deliver your packages depends on where you live and what day the package arrives. For example, USPS delivers Amazon shipments to me on Sundays and Saturdays, but FedEx and UPS are often the primary carrier during the weekdays.
One could argue that UPS, FedEx, and USPS are more important to Amazon then Amazon is to the shipping companies. I think the pressure to keep their costs low results in the Amazon contract not necessarily being a very profitable part of the business. I suspect the carriers earn much higher margins shipping for other companies.
Most Amazon deliveries in my area are done by Amazon-branded vans these days. I assume these are owned and operated by Amazon. Used to be mostly USPS and occasionally UPS.
Most likely, those Amazon vans are actually owned and operated by independent contractors who are licensed by Amazon. They are very likely not employees of Amazon.
The most expensive part of the delivery is the last mile to your house. In larger cities, Amazon has an incentive to "in-house" the last mile rather than use UPS, FedEx, or USPS. One van can stop at an apartment and drop off a larger load of packages, which normally would be more profitable deliveries for the logistics companies. Amazon does not want to control the entire delivery process and vertically integrate because some deliveries are not very profitable. They can cherry-pick the best routes/markets and run those on their own, while outsourcing the less profitable or more labor intensive deliveries to the others.
I would think these Amazon delivery contractors face a lot of pressure. The packages have to be delivered on time. They are not necessarily making very much money on a per parcel basis, so they have to move fast to make it pay. Not a job that very many would want to do day after day.
Finance Guy wrote:
Most likely, those Amazon vans are actually owned and operated by independent contractors who are licensed by Amazon. They are very likely not employees of Amazon.
You are correct:
https://logistics.amazon.com/marketing/opportunityIf it is a package fulfilled by Amazon, it will be shipped USPS.
If it is a package fullfilled by the seller, it will be shipped UPS.
So who holds the cards? If UPS decided to up their shipping costs, is Amazon screwed or do they just turn to DSL or some other shipper?
Does UPS have Bezos by the short hairs or is it the other way around?
ataglance wrote:
Shouldn't Amazon just buy UPS and make it official? Aren't both companies so dependent on the other that they are essentially one?
Business smart guys tell me how I'm wrong.
Trump hates Amazon.
quickndirty wrote:
So who holds the cards? If UPS decided to up their shipping costs, is Amazon screwed or do they just turn to DSL or some other shipper?
Does UPS have Bezos by the short hairs or is it the other way around?
Neither really - short term Amazon couldn't up a switch partners or ramp up their own deliveries without significant issues and unhappy customers but long term they will/are limiting their exposure and trying to cut costs. UPS on the other hand depends on Amazon for a lot of gross rev (even if Amazon deliveries margins are smaller than most of their customers) and to fill the funnel with packages making their huge network more efficient and providing cash flow. UPS knows what Amazon is doing an will work to continue to limit their dependance on that volume.
Joe Jackson wrote:
Most Amazon deliveries in my area are done by Amazon-branded vans these days. I assume these are owned and operated by Amazon. Used to be mostly USPS and occasionally UPS.
That's the way it is here in So Cal.
UPS - The men in brown . Little known fact: At the start of one's shift, their pants are white. After depositing feces in them all day, the color changes slightly.
Finance Guy wrote:
The most expensive part of the delivery is the last mile to your house.
That's because they need three tries to get it done! Clown couriers UPS.
They expect recipients to pay for the privilege of giving them useful logistical information such as when they will or won't be home.
Lately they have stopped delivering by default and now use storage lockers with an Orwellian ID requirement. I will not tolerate any seller who uses UPS, and I've managed to badger Amazon into blacklisting them from my orders.
Just deliver it.
I often shop with Ebay, Amazon sites. The company https://mrspeedy.ph/ is engaged in express delivery of goods in the Philippines and abroad, as well as documents and money orders. To find out how to track the package, you can consult the department or on the official website. To do this, there is a tool in the mobile application and tracking on the site.
Bad Wigins wrote:
Finance Guy wrote:
The most expensive part of the delivery is the last mile to your house.
That's because they need three tries to get it done! Clown couriers UPS.
They expect recipients to pay for the privilege of giving them useful logistical information such as when they will or won't be home.
Lately they have stopped delivering by default and now use storage lockers with an Orwellian ID requirement. I will not tolerate any seller who uses UPS, and I've managed to badger Amazon into blacklisting them from my orders.
From dissing Nick Willis to package delivery, you come off as a bitter and petty old man.
The Post Office is a losing operation funded by taxpayers and run by political hacks with no real business acumen.
You can bet their contracts with Amazon are in favor of Amazon.
UPS prices have gone through the roof and service has plummeted. I've been in the Custom Screen Business for 40 years and let me tell you, they have gone downhill.
These days, quality and service have given way to cynicism in the business world as far as I can see. The corporate attituded is profit, automation, and f*ck you. Oh, and screw the workers.
hart crane wrote:
USPS, too.
My wife had an Amazon package delivered on Easter Sunday. By a US Mail carrier.
Easter Sunday is no longer an important day in the USA. It’s almost 2020, get with it.
No. My father is the CFO of the worlds largest air freight company so very close to UPS. Amazon needs the shipping companies more than the shipping companies need Amazon. You may buy everything from amazon, but there’s 100 times if not more goods being moved around the world than just Amazon purchases.