Amazon’s Foray Into Last-Mile Delivery Could Disrupt E-Commerce Sector
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It takes only a few minutes for the white rental van to pull to a stop and a contract worker in a reflective vest to drop a package on the front porch.
The unmarked van slips away as quickly as it arrives, with no logo and no fuss. As far as market disruption goes, Amazon.com’s expansion into local package delivery service has seemed like more of a toe-dip than a belly-flop.
“Amazon delivering changes the dynamics a little bit as far as the shipping companies,” said Kim Blaylock, owner of the independent shipping business Goin’ Postal. “But you shouldn’t see a whole lot of difference. You’re still going to have a package delivered to your house whether you’re there or not.”
Still, Amazon, one of the world’s largest companies, is not known for tiptoeing on the turf of an established business. Just ask someone who used to work for a bookstore.
Tony Webster/Flickr
The e-retail giant has built up its logistics infrastructure over the years, including a new warehouse just outside Omaha, Neb., as part of an effort to control more deliveries on its own rather than relying on FedEx Corp., UPS Inc. or the U.S. Postal Service.
At times, the discussion has turned to Amazon’s futuristic plans for using drones. For now, the company relies on a lower-tech form of competition that resembles Uber more than “Star Wars.”
Amazon is hiring contract workers, many driving white rental vans, who handle last-mile, ground deliveries to homes and businesses. These contract workers have been noticed in St. Joseph for the past couple of weeks.
Blaylock operates an independent shipping and receiving business that acts as a drop-off spot for UPS, FedEx, DHL and the post office. In recent weeks, he’s started to notice Amazon contract workers dropping off packages.
He said the biggest change for customers will be that packages will have to be tracked through Amazon.
“One thing that may change is you may see someone coming up to your neighbor’s sidewalk with a package,” he said. “The Amazon people don’t necessarily have any logos or anything on the truck that says Amazon. So there may be some questions there.”
Stephen Brashear/Associated Press
He said other shipping companies are watching the developments closely and may be affected more if Amazon starts handling its own returns.
FedEx said in a statement that there is plenty of e-commerce business to go around. The company recently decided not to renew one of its contracts with Amazon as the two companies increase competition.
“There is significant demand and opportunity for growth in e-commerce, which is expected to grow from 50 million to 100 million packages a day in the U.S. by 2026,” FedEx said in the statement. “FedEx has already built out the network and capacity to serve thousands of retailers in the e-commerce space. We are excited about the future.”
For the U.S. Postal Service, competition from Amazon comes at a time when some in St. Joseph are asking if mail carriers even deliver every route every day. Stacy Hopwood, a communication specialist with the Postal Service, said this is the perception because first-class mail has plummeted due to electronic communication and other factors.
“Folks who used to get mail every day may go one or two days without getting any mail at all,” she said. “We deliver every route every day. There are no exceptions.”
