A version of Seller Flex first made its appearance two years ago in India, but now it looks as though Amazon is bringing the service to the U.S. as well. Trials have already begun on the West Coast, while a larger rollout has been slated for 2018. This would represent a major break from longtime delivery partners United Parcel Service (UPS) and FedEx.
How would this work? According to Bloomberg, Amazon would oversee package pickups from non-Amazon warehouses, as well as their subsequent delivery. As it stands, this process is largely taken care of by UPS and FedEx, and while Amazon might still use these carriers alongside Seller Flex, Amazon itself would decide how the package is ultimately delivered (currently, the seller decides).
For Amazon, this could mean more flexibility and control over the entire purchasing process.
“Amazon’s final-mile efforts reflect a logical extension of its model as it builds network density,” Benjamin Hartford, a Robert W. Baird analyst, told Bloomberg. And it doesn’t exactly come as a surprise. Amazon has long been looking into alternatives to reliance on its shipping partners, even leasing a fleet of airplanes last year. After all, given that one of Amazon’s greatest value propositions is quick, dependable delivery, it makes sense that the company wants to ensure that deliveries are indeed both quick and dependable.
That said, current partners are obviously none too thrilled about the possibility of losing one of their biggest customers. “Amazon is a valued UPS customer,” said Steve Gaut, a UPS spokesman. “We support all our customers with industry-leading ecommerce solutions and expect to expand these relationships further in the future.” The stock prices of both FedEx and UPS fell in the wake of Amazon’s news.
