Amazon to Create an Armada of Small Delivery Companies In Move With Promo Implications
In move with potential implications for the promo industry, Amazon has announced that it is recruiting hundreds of entrepreneurs to start their own businesses delivering Amazon packages.
In the press release, the company claims that the opportunity will allow new small-business owners to hire tens of thousands of delivery drivers across the U.S. In addition, the e-commerce giant is committing $1 million in funding toward startup costs for eligible military veterans looking to take part in the program.
According to Dave Clark, senior vice president of worldwide operations for Amazon, the program is aimed at meeting increased customer demand for packages and delivery services.
“We have great partners in our traditional carriers and it’s exciting to continue to see the logistics industry grow,” he said in the press release. “Customer demand is higher than ever and we have a need to build more capacity. As we evaluated how to support our growth, we went back to our roots to share the opportunity with small-and-medium-sized businesses. We are going to empower new, small businesses to form in order to take advantage of the growing opportunity in e-commerce package delivery.”
Following the announcement, stocks for FedEx and UPS fell significantly, with many seeing the move as an attempt by Amazon to take full control of all aspects of its supply chain, especially with regard to shipping and delivery.
Amazon has been a lurking threat to the promotional products and apparel industries, among other sectors, for a while now. Earlier this week, we reported that the company has been quietly expanding its Merch by Amazon program—a direct-to-consumer, on-demand products service that many are comparing to the likes of CafePress and Redbubble—and launched its four private-label apparel brand.
If the company’s foray into delivery manages to succeed, it could threaten traditional shipping companies like FedEx and UPS, while also potentially reducing the cost of shipping for its Merch by Amazon offerings. That could position it as an even-more-direct competitor to traditional promotional products companies.
Here's Olaoluwa Abimbola, a beta participant in the new delivery service, via Amazon's press release:
I had prior experience running my own business but not in logistics. I was driving for Amazon Flex when I learned about the opportunity to start my own delivery company. Backed by Amazon’s resources and logistics experience, and its encouragement to "learn while I earn," this opportunity was a no-brainer. In just five months, I have hired more than 40 employees, and it’s encouraging to know that any driven individual can use Amazon’s support and the Delivery Service Partner community to build a successful, thriving business.
As always, we’ll keep you posted as things continue to develop.