BIG NEWS...
Amazon aims to go it alone with deliveries !
Internet retailer is taking logistics beyond the warehouse and direct to doors as it invests to bring down shipping costs .
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The Amazon distribution center in Tracy , California , looks more like a traditional...chocolate factory , than a traditional warehouse . Items zoom around on conveyor belts and are soryed into chutes by robotic hands .
Mechanical arms paste on shipping labels , while thousands others fetch stacks of items as soon as they are requested .
The technology inside Amazon's distribution centers has long been a key advantage for the group , which has built more than 120 giant warehouses worldwide . They form a competitive moat that has for years helped keep would-be Amazon competitors , such as Walmart and Target , at..bay .
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Now Amazon has set its sights on a new goal - taking its logistics technology beyond the warehouse and direct to customers ' doors , as it pushes into sameday and one-hour delivery .
Amazon has been investing heavily in the logistics needed to extend all the way through its delivery chain .
It is buying its own track trailers , hiring on demand delivery workers and building a new type of delivery hub - with technology that has been kept under wraps in cities like N.York and Seattle .
Analysts believe door-to-door delivery could be the next big sector that Amazon disrupts , in the same way it shook up cloud computing services by launching Amazon Web Services .
" The logical next step is , if you are going to have all this infrastructure , why not open it up to be a competitor to logistics networks like FedEx and UPS , " says Scott Wingo , executive chairman of ChannelAdvisor , a software provider for retailers that use Amazon and eBay .
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Amazon's shipping costs have surged in recent years , with shipping losses reaching more than 1.2 billion in the most recent quarter , a third quarter record .
The cost of getting packages to customers'doors has been rising relative to sales , reaching 12% of net sales in the most recent quarter . Analysts say the group is experimenting with doing more deliveries itself - rather than using parcel and postal services - as a way to pottentially cut costs over time .
A core plank of the expansion is Amazon's one-hour and two-hour delivery service , Prime Now . Launched a year ago , Amazon introduced the expedited service to more than 20 cities , including London and Milan .
To power the service , Amazon has opened more than two dozen Prime Now delivery hubs within these cities , and could one day use drones for rapid delivery if regulatory approval is obtained .
A supply chain consultancy analyst , said.." They are really gearing up for a highly responsive , high-speed logistics network to service their customer base " .
" They are doing it very secretly , they really don't want anyone to know the address or location or where they are positioning themselves ! "
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Amazon has traditionally relied on third-party partners for the last mile-getting packages to a door - such us UPS , FedEx and the US Postal Service .
However , for the Prime Now service , Amazon has hired delivery drivers in more than a dozen cities who use their own vehicles and work flexible hours .
Workers in the " Amazon Flex " programme receive much of their pay in tips that customers can programme into the " Prime Now "
app .
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Amazon declined to say whether this logistics push might supplant current delivery partners .
In a recent statement , the company said it had purchased a fleet of thousands of Amazon -branded truck trailers to ferry goods from distribution centers to sortation centers , marking the first time the company has owned truck trailers .
Analysts are sceptical that customer demand will support the high cost of expedited delivery ...
" Customers will say getting free shipping is more important than getting it fast . "
Analysts believe that Amazon's real goal is to increase its leverage over the delivery companies it uses , and to test whether it can replicate these services more cheaply in-house .
Amazon's dominance of rapid response shopping is also facing a growing crowd of competitors from Google Shopping Express,
which delivers next-day household items , to UberRush , which offers expedited delivery of certain retail items .
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FINALLY...
Amazon's push into logistics , comes as UPS and FedEx , the US
biggest parcel delivery companies , struggle to adjust to the huge changes that the rise of online retailing has brought to their businesses .
Both companies have witnessed big surges in parcel traffic because of e-commerce purchases .
But the cost of making deliveries has soared and it has become more complex .
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WORLD'S BIGGEST LOGISTICS COMPANIES .
( by revenues in € bn ) .
========= 0 10 20 30 40 50
DEUTCHE POST DHL __________________________
UPS _________________________
FEDEX ________________________
MAERSK ___________________
DB MOBILITY LOGISTICS___________
UNION PACIFIC RAILROADS______
BNSF RAILWAYS
RUSSIAN RAILWAYS
NIPPON YUSSEN
KUEHNE + NAGEL
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BLOGGER'S COMMENT....
Well , it seems e-commerce and online commerce have caused
serious side effects to literally ALL THE GLOBE'S BIG RETAILERS ..and inevitably to the forwarders of their goods .
Huge changes will effect ( once again ) all their workers and employees , some mergers can be expected , and new " flexible "
numbers in jobs' reports should be considered in the data provided by world's governments....
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