SWA Amazon’s New Shipping Service and a Rival to FedEx and UPS
Amazon has planned its next move and come up with a big surprise of its shipping strategy for its sellers, customers as well as competitors. Actually, this can be expected from Amazon as Amazon always keeps on thriving on updatingts services. Amazon is the first choice of most of the online buyers as it deals in all categories which are required by the shoppers. From household stuff to grocery, from furniture to automobiles, from jewellery to skin care products; from books and novels to electronics gadgets- Amazon is show stopper for all.
What Amazon has in its bag now?
The giant Amazon has visioned something else with its best foot forward in the shipping on its own. It has recently launched its shipping services or SWA i.e. “Shipping with Amazon” in Los Angeles and thinking to spread this service globally. The SWA is now available for third-party Amazon sellers of Amazon.com. Amazon is about to extend its SWA services for all the sellers that are even not the third-party sellers of Amazon by the end of this year. Surely, it would take some time but Amazon would surely achieve it to leverage its customers with the convenience of shipping and final delivery of the products and items they buy. The next step would be the Amazon drone delivery services. It will be good to know that Amazon is working on it.
How did Amazon manage shipping services before SWA?
Amazon serves its customers in the best possible way to boost their shopping experience. It depends on UPS and FedEx for shipping the items to its customers. The Amazon sellers put their products in the Amazon’s inventory and through FBA, Amazon fulfils the customer’s orders with the help of UPS and FedEx to ship the products to the ultimate destination(customer’s address).
Since SWA is in its preparatory phase and may be Amazon is taking this as hit and trial method, therefore, it has not completely eliminated UPs and FedEx for its shipping service.
Let us explore more about SWA…..
If we dive into depth, this is not the first time when Amazon is shipping the products on its own. If we believe the previous reports of Wall Street Journal, in the year 2016, it has initiated its pilot service program and even without SWA Amazon delivers orders in about 37 US cities. In recent years, it has built a delivery network with air cargo planes hub and ocean freight. So, SWA is not a big surprise, infact, it is next step in Amazon’s serving and delivery chain.
Most of the Amazon analysers say that Amazon’s SWA would follow the same track as Amazon’s AWS (Amazon Web Services). As initially, Amazon had created AWS cloud computing infrastructure for own and later on when it has succeeded, it allows the third parties to utilize AWS platform (of course, Amazon incurs charges to them). In the same context, when SWA would succeed in its plan, Amazon might allow the third parties to use it with the paid charges.
Amazon’s SWA will create a tough competition for UPS and FedEx. Amazon thinks that shipping through UPS and FedEx costs more and obviously it affects the customer’s shopping experience. This would affect the FedEx and UPS business strongly. Therefore, through SWA, Amazon would try to negotiate the shipping charges and obviously add a new experience of shipment to its customers.
Shipping through third parties includes transportation, delivery centre and sortation costs that were in billion for Amazon in the previous years. The costs were about $11.5 billion in 2015, $16.2 billion in 2016, and $21.7 in 2017. Obviously, this will be going to increase year by year. This might be the reason why Amazon has decided to ship on its own.
Being an Amazon seller, you are obviously working on the boosting tips for online sales and shipping strategies to sell globally through Amazon. Here, Amazon too is working on its shipping strategy. SWA is Amazon’s attempt to cut out the prices as it costs more in using UPS and FedEx for delivery services, then, we would have to wait to see the magic of this services on the third-party Amazon sellers and their customers. It would surely divert the business trends. If amazon succeeds in crosscutting the shipping charges, With Amazon’s FBA and AWS, SWA would be a new milestone in the Amazon’s history. Let us be the witness to the Amazon’s next success.