Industry news

Amazon expands US 3PL capability

Published by June 06,2019

Amazon expands US 3PL capability

    E-commerce giant goes live in New York, LA and Chicago with ‘Amazon Shipping’, offering full seller-to-customer shipping service, further extending its logistics capability to third parties


    Amazon has extended the in-house logistics capability it offers to third-party merchants, going live from New York, Los Angeles and Chicago with its ‘Amazon Shipping’ offering - which consists of picking up packages directly from ‘invited’ sellers’ warehouses every weekday and delivering them seven days a week to customers nationwide, according to TJI Research, a company specialising in information and analysis about the e-commerce giant.


    The service appears to be an upgraded version of the ‘Fulfillment by Amazon (FBA) Onsite’ service that the company trialled last year and appears to mark the next stage in a continuing process in which makes its own highly-developed logistics capabilities available to third parties.  


    Logistics observers say this full seller-to-customer shipping service is further evidence of Amazon encroaching not only on to the preserve of long-time delivery partners UPS and FedEx but also major ‘pure’ logistics players such as XPO Logistics. TJI Research said it was likely Amazon Shipping will be expanded to more major metropolitan areas.


   “In addition, while we understand Amazon Shipping currently only operates via ground, we generally expect Amazon to employ more of its logistics assets and expertise to incorporate air and other modes of transportation in the future. We also expect Amazon to continue to work with logistics partners both for regular Prime shipping and possibly for certain parts of the Amazon Shipping network as well.”


    Amazon’s air cargo footprint appears set to grow significantly in the next couple of years, with the online retailer gaining access to more aircraft while also increasing its equity stakes in the leasing operators supplying it with freighters, Atlas Air Worldwide (AAWW) and Air Transport Services Group (ATSG). In a filing last week to the US Securities and Exchange Commission (SEC), AAWW said that it had entered into an ‘amended’ agreement with Amazon in which AAWW subsidiary Southern Air will provide crew, maintenance and insurance services (CMI) to Amazon using Boeing 737-800 series aircraft.

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