Amazon launches start-up service to deliver its own packages

Amazon launches start-up service to deliver its own packages

Amazon launches start-up service to deliver its own packages

Amazon is also taking a big leap in the delivery business.

Olaoluwa Abimbola, a Delivery Service Partners beta tester, is an early program success story."I had prior experience running my own business, but not in logistics", said Abimbola.

With its new initiative launched Thursday, online retail giant Amazon appears to be attempting to cut out some delivery middlemen by the names of the U.S. Postal Service, FedEx and UPS. But as it's helping entrepreneurs, Amazon is also helping itself gain greater control over its own logistics network. Yahoo Finance's Seana Smith, Dion Rabouin, Myles Udland and Dan Roberts discuss.

Dave Clark, Amazon's senior vice president of worldwide operations, said the new program isn't a response to the president, but a way to make sure the company can deliver its growing number of orders. It claims that these people could make as much as $300,000 in yearly profits and have up to 40 delivery vans under their control.

To solve its ongoing last mile delivery problem, Amazon turned to solutions like the Flex program, that paid individuals to use their own cars for deliveries.

However, Amazon will continue to work existing partners, including UPS and FedEx, in addition to the USPS and smaller last-mile delivery partners, for some time. Military veterans can apply for $10,000 to reimburse startup costs.

Each delivery unit will start their day at one of 75 current Amazon stations in the US where parcels ordered from are picked up by drivers wearing blue-collared shirts with an Amazon logo and black hats.

The new program goes a huge step beyond the gig economy side-hustle that is Amazon Flex.

"This new service for Amazon is not going to be "instead of" the service it already has with the FedExes of the world". This includes offering discounts on "Amazon-branded vehicles customized for delivery, branded uniforms, fuel, comprehensive insurance coverage, and more".

The company expanded its Amazon Key service in April, allowing delivery people to leave packages in someone's parked auto, as long as the vehicle is parked in a publicly accessible place.

In other words, Amazon has put together what amounts to a turnkey delivery fleet operation. "This is really about meeting growth for our future", he said.

The company has been building up its own fleet of 7,000 of trucks and 40 airplanes to cover the "middle mile" of delivery.

He hired more than 40 workers in five months, Abimbola said. They haul goods between shipping centers and bear Amazon logos, but don't show up at customers' doorsteps.

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