It’s to the point where I can’t blame Amazon for actions like these.
The consumer has come to expect guaranteed overnight or 2 day shipping. When they don’t get that, they get really upset.
Amazon doesn’t want its customers to get upset, and it can’t trust its shipping partners because they don’t have the burden of the consumer sentiment. No one blames FedEx for their late package these days, they blame Amazon. Heck, you don’t have to look hard to find product reviews that only gripe with the shipping time or condition.
Amazon is going to vertically integrate shipping, no question. The market demands it, and Amazon will probably eventually ship more packages than any of its competitors. And, Bezos isn’t dumb, so he’ll build and sell this capacity to others.
Amazon is reaching further and further into the economy, and I don’t see much stopping them.
Amazon is going to vertically integrate shipping, no question. The market demands it, and Amazon will probably eventually ship more packages than any of its competitors. And, Bezos isn’t dumb, so he’ll build and sell this capacity to others.
It AMAZES ME how unreported it goes that they are doing this right now. They are doing it hilariously upfront and clearly. They bought massive amounts of Sprinters for Amazon Delivery to non urban areas, they are rolling out (classically urban only) Amazon delivery to areas near warehouses right now.
And then.. then. They went out and made an order for 100K Rivian delivery vehicles, ONE HUNDRED THOUSAND. The headlines were all focused on the Tesla factor and how they are electric and nobody bothered to ask.. 'Why?'. That's like the number of trucks UPS Owns, PERIOD. That should have been the headline 'AMAZON ORDERS OWN FLEET TO REPLACE UPS, FEDEX' But nope 'Bezos bets on electric with Rivian order'
"Doing logistics" for one's own shipping, is a bit different than "trying to subsume the role of FedEx/UPS in the economy." Certainly it's "only" a matter of scale, but logistics-as-a-service (the business FedEx and UPS are in) is as large a market as the one Amazon's already in, and you'd think clear signs of them being ready to suddenly add another few hundred billion dollars to their market cap would be reflected in e.g. investment people issuing new guidance about them.
"Investemnt people" are reading research reports from banks (and their own analysts), not relying on mass market papers for the news. You can see it on Bloomberg.com sometimes, there will be a link to a story with more economic detail, but it will be gated by a terminal subscription.
"Ambition" rather than 'They are just killing off UPS and FedEx' Its a huge billion dollar story that's been incredibly soft, just look at UPS's stock, this will result in them losing their largest partner, no movement at all.
I am super sure there is an acquisition of one of convoy et al by amazon very soon to build the AWS for trucking as well because they're going to have so much extra capacity in a matter of 2/3 years.
Convoy like companies don't actually have capacity from my understanding: They are building a uber like platform to share extra capacity. <it is also funded by Bezos> So if Amazon is to build their own trucking-cloud, this is just a logical buy (unless they decide to build in house for some reason)
Yep. They also used to drive unmarked vans for a while, but now I see blue Amazon Prime delivery vans everywhere. I still get an occasional item from Amazon delivered by someone else(I guess they still use other couriers when their own capacity is out) but 90% of the time it's delivery by Amazon. And it's much better than anyone else, they give you a relatively precise 2 hour slot and you can see where your driver is on the map. Only DPD did that previously, and even then not for every parcel.
> No one blames FedEx for their late package these days, they blame Amazon.
As they should. FedEx's customer in this instance is Amazon, not the receiver of the package (who is a customer of Amazon, and Amazon alone). If anyone has the clout these days to hurt FedEx economically if they don't improve, it's Amazon. Amazon should be pushing FedEx (and their other shippers) to be more accountable for late, damaged, and lost packages.
These days both FedEx's and UPS's preferred delivery method seems to be to rake their hands over every single door buzzer to my apartment building, dump the packages outside (insanely unsafe), and run off before anyone has a chance to respond to open the door. They even do this for signature-required packages on occasion, forging the signature. I get that drivers' incentives are completely screwed up regarding how their performance is evaluated, but it's a terrible experience from my perspective.
Amazon doesn't seem much better. Last week, they 'delivered' an item, marked it delivered. The problem with that is that I didn't get it, and the picture proof was not my house. I have no idea whose house it was. When I called to ask for a refund, they first told me to wait as sometimes they mark things delivered before they are. I told him about the picture. Then he asked me to go door to door in my neighborhood because maybe someone else has it. I told him in a not so nice way that was their job, not mine. In the end I -did- get a refund, but seriously, I can't imagine UPS or Fedex saying things like this.
Fedex keeps delivering other people's stuff to my mother in law's house. The correct addresses are within a few blocks. I can assure you that Fedex really doesn't care or help in this case, over several instances of it happening. I suspect that this issue like others being described can come down to the driver that does a route, and what they do.
I would be surprised if Amazon is not using their Ring doorbell cameras to check on deliveries. They will provide evidence of what really happened when customers and delivery dispute it. For example it is clear if the doorbell was rung, or in some cases if the vehicle even went down the street.
My Amazon delivery was pretty strange. I had an unknown number call my phone 2-3 times in a row (dumped to voicemail) then a few minutes later a frantic knocking on my door. It's two guys who were out of breath, they handed the package to me, and then jogged away down the apartment hallway.
I think I ordered socks or something... I couldn't care less. It was jarring, just leave the package in the lobby and send me a delivery notification... geez. Prefer FedEx over that experience.
Funny you should mention the door to door thing. I literally just got this email from a merchant that shipped via FedEx. The package went from being delivered on the 13th to lost in limbo at the regional hub. Yay me.
> In the meantime, I would recommend checking around neighbors and with any other potential members of your household to ensure the package was not incorrectly delivered.
Right? It's such a braindead thing to ask. Imagine having a package on your porch, and seeing someone walk up your driveway and grab it. That's a good way to get punched before you have time to explain.
Fedex mentions this is not a material amount of business. How Amazon operates it's last mile logistical network is unsustainable. These people will eventually churn out of the open air sweatshop that is delivering last mile for Amazon (Fedex's requirements are much less onerous on the ground/home delivery side, based on my conversations with both Amazon delivery drivers and Fedex ground and home delivery drivers).
Very similar to the high churn Uber and Lyft experience with drivers. It lasts only as long as you can find people desperate enough to work in these roles.
After running the numbers from Amazon's presentation on starting your own delivery company, I came away thinking its a nice JOB. In order for it to be a good profitable business that allows you a life of leisure, you end up having to manage around 400 drivers and 200 trucks, and I'm not sure if that is possible to scale that high with their model.
Do a run with an Amazon driver and see the kind of job it is. I have, and it is not a job I'd have versus a traditional retail job. Agree with your point though that you're buying a job, not a business. Lots of better businesses to buy, lots of better jobs one could have.
The difference with Amazon running that way and Fedex/UPS is that Amazon has AWS to prop up other services that run at a loss. They can run their shipping service at very low or negative profit and use AWS to make up for it.
It's going to take a while for the "you're not actually making money, the profits all go eventually into the wear and tear on your vehicle" thing to filter out into general public awareness.
I've had plenty of flat-out lies from Amazon delivery before (e.g. they claim delivery attempted at HH:MM PM, while I was in the living room five feet from the door, and yet somehow I must have "missed" their knock), FedEx and UPS alike, although I've never been able to prove it. With the proliferation of people with Ring video doorbells, however, I am surprised that someone does not send footage.
"Oh, you tried to deliver at 3:13 PM? Well gee, my front door camera sure doesn't seem to show anyone approaching my door at that time!"
But again, you're already dealing with people that will lie to your face, so I can't imagine why video proof would compel them to change their strategy.
I don't think any of this has anything to do with Amazon, or at least it isn't limited to packages from Amazon. I've had several categories of what are almost certainly flat-out lies from various carriers throughout the years:
- Packages marked as being delivered, but they don't actually show up for another day or two. (I assume this is a driver who can't be bothered to make it to my building that day but doesn't want to get penalized.)
- Entire carriers who systematically fail to deliver. My current apartment building has a near zero delivery rate for packages from USPS that cannot fit in mail slots. UPS and FedEx generally deliver to our package room without issues, but USPS will just claim to have attempted delivery two days in a row then leave the package at their sorting facility for me to pick up (which I won't do). This is clearly a building-wide problem, because I see hand-written notes on our outside door begging USPS to deliver packages. I think the USPS package delivery person simply cannot be bothered to try, and is apparently not incentivized to do so. Thankfully this rarely affects me, because the only time I get larger USPS packages are from rare Amazon deliveries that for some reason use USPS.
- Packages that claim that the delivery was attempted on a Saturday, but are redelivered on Monday. This has bitten me a few times where I took care to rush a package to me when the shipper claimed it could be delivered on a Saturday. I suspect the weekend delivery person cannot be bothered to make it to my building. I can't really blame them. Saturday delivery is fairly new and I can live without it, I just wish the carriers wouldn't promise it then "attempt to deliver" unsuccessfully.
My apartment building has a call box and someone will buzz them into the package room. When it says “delivery attempted” it’s almost always because the delivery person couldn’t be bothered to try.
I've been sitting at the door expecting a delivery that I paid to have delivered by 10am and saw a UPS driver run up to my door and put a note saying he missed me then running away. I opened the door and made him actually attempt to deliver. He didn't even ring the doorbell.
Yeah, I've also had FedEx lie to me multiple times. Both times they claim delivery was attempted while I was home the whole day (and it was not, obviously). I've even noticed it within an hour of it happening, mid-day. I think sometimes if the drivers get behind they just skip houses and mark it as "attempted."
This is probably due to an overworked worker pushed to meet some metric saying something is delivered when it isn't. I'm sure amazon will do everything they can with software using gps, pictures etc to make it harder to do that.
The last time this happened to me, Amazon's CSR told me that "GPS says it was delivered nearby your building." To which I responded that there were multiple suites inside the building. She then asked if my suite had a mailroom, and I repeated that I had a one-room suite.
Indeed they are doing exactly that. I get a notification when the driver is a few stops away from me along with a map. They also take a picture of the package where they left it and it is all visible from the Amazon app.
In probably a dozen instances in the last two years, I've had premature "Delivered" statuses, with windows of an hour before it showed up, to two days.
2 have been FedEx, 2 USPS. The rest were Delivered by Amazon deliveries.
Amazon isn't helping anything by their "just in time" delivery model. If there is a truck going out that will allow 8-hour delivery, they will deprioritize the package for 40 hours and then mail it out on that truck.
In turn, that leaves Fedex and UPS absolutely no margin for error. Package shipping errors happen, especially in the weeks before christmas when volume goes through the roof. But Amazon has wasted all the safety margin so if even one error occurs they blow their delivery window.
It's hard to say whether UPS/Fedex have a problem without looking at their metrics, but Amazon sure isn't helping by pushing everything to the bleeding edge. Anecdotally over the last year or so I have noticed an increase to the point where virtually all (let's say at least 75%) of my "2 day delivery" (or even amazon day/no-rush) packages are being shipped like 11 at night on day before delivery and they just beeline it to me same-day.
The closer companies squeeze just-in-time logistics to the limit, the more they are increasingly reliant on a flawless demand model.
It's the biggest reason I've stopped shopping at Walmart in recent years. I can't rely on being able to go to the store and expect that everything is in stock.
Let's dust off my old binomial probability skills:
Assume Walmart's just-in-time demand model is accurate to the extent that 1% of items in the store were misjudged and are out of stock. Let's say I go in for a shopping trip of 30 items. I'll have a 26% chance of being disappointed that one of the items I needed was out of stock, and I'll have to go somewhere else now.
Those are completely made up numbers, but it demonstrates how a seemingly small error can be a big inconvenience for someone.
which is why it's insane that it was ever an option for people selling under the prime label. If it's ground, FedEx manages to take the longest possible time they can, even if it's only going a few miles.
I had faster delivery of a pallet on FedEx Freight than I've ever seen from FedEx Ground. Ground is my least favorite (but Amazon doesn't do their own deliveries here).
Amazon is reaching further and further into the economy, and I don’t see much stopping them.
As much as I'm concerned about monopoly and the potential for anti-competitive behavior... I'm impressed by how effectively Amazon operates at the scale that it does. It's not like Comcast or AT&T which operate horribly at scale. I wish they would get disrupted by Starlink or something and go out of business.
It's all about Amazon's focus on customer service and customer satisfaction. By keeping customer happiness as a top priority, customers will continue to return for future business and trust Amazon in new categories.
They prioritize customer happiness above profit and put any profits made into growth, so they will continue to grow by making more customers happy and opening new categories.
AT&T are established utility monopolies. There is simply no comparison here. When Amazon owns the roads, or when they put UPS & FedEx out of business, then we can start making these comparisons.
Amazon offered overnight or 2-day shipping, and it turns out that customers apparently love it. I suppose we can quibble over who "creates" the expectation, but note that other things Amazon have offered or tested did not lead to intense customer demand.
Amazon offered 2-day shipping, then changed their free shipping from 5-days to 8-days, deliberately changing a luxury to a necessity so they could up-sell it to more people.
I know I was perfectly happy when packages that I ordered on the weekend arrived in time for the next weekend most of the time, and never paid for expedited shipping. It was only when most of those packages started taking more than a week to arrive that I finally signed up for Prime.
And that expectation is a key reason why many people use Amazon more often nowadays, in situations where they'd previously have gone to a retail store.
The bad thing is their market position and ability to negotiate rates makes it much harder for independent business operators who must charge more for shipping or else lose money. The situation isn’t sustainable. Eventually, unless something drastic happens, we’ll be faced with asking whether they should be permitted to provide their own delivery services or not due to concerns about competition.
Not really. There are two outcomes that are more likely to happen than others, both of which are terrible for consumers.
In one scenario, Amazon utterly destroys the ability of others to sustain their business, and then raises their own prices dramatically: a fairly typical monopoly scenario.
In another there are two tiers: Amazon and everyone else, which is only marginally better.
In both cases competition is reduced and the consumer suffers.
Instead of criticising Amazon for being able to achieve next-day delivery why don't you criticise FedEx for not being able to achieve it? We want to select out badly run inefficient businesses, not support them artificially. If there's a monopoly developing it's because everyone else is incompetent. Tackle them!
I think they created the expectation of vertical integration too. “Amazon does it better and quicker”, a retail customer might think, as they peruse possible cloud providers.
Amazon is an incredibly sticky brand because they created expectations that you almost have to be vertically integrated (or at least one of the largest customers of the post office, the electric company, the computer hardware company, the software vendor, etc) to fulfill.
True, but UPS/USPS/Fedex all helped to enable that expectation. It pains me (almost physically) to give the benefit of the doubt to Amazon, but if the carriers couldn't reasonably fulfill the 2-day delivery expectation the way Amazon wanted, they wouldn't have attempted it, and the expectation wouldn't be set.
What blows me away is that frequently my expected delivery date for Prime orders is next day. More often than not that leaves my packages handled by Amazon or one of their third party contractors. Greater than 75% of the time the package does not come on time. Often times it even turns into 3 days.
If using the established players means the buy button says arrives in 2 days and it arrives in 2 days then I would be SIGNIFICANTLY more satisfied with Prime. I haven’t read enough of the other comments yet to know if my experience is the norm but I really think Amazon would be better off abandoning this whole scheme and letting the pros handle it. It wouldn’t kill American consumers to wait another day.
Side rant: I’m absolutely sick of the armada of rented panel vans from Enterprise blasting random circles through my residential neighborhood. Make them take the earbuds out and for the love of god give them some kind of routing that makes sense.
Maybe it’s my city but that’s not the experience I have here.. but Vancouver also does seem to have a lot of loading areas in front of and alleys for them to use
"Transportation By Amazon" (TBA) used to be a pipe dream and was envisioned as a way to use Amazon's cheaper shipping rates to ship packages of all types.
With the build out of Amazon's own transportation network, Transportation By Amazon is poised to become a reality. The biggest part that remains is the pick-up of packages for shipping / reverse logistics. This should not be too hard, especially as Customer Returns is integrated into Amazon's transportation network.
After Customer Returns is done, it's just a matter of figuring out how to get accurate shipment parameters (box size, weight, type of goods being shipped) and then building a website front-end to advertise and slowly ramp up the capability and learn how to handle different types of exceptional conditions.
> Amazon is going to vertically integrate shipping, no question. The market demands it, and Amazon will probably eventually ship more packages than any of its competitors.
Amazon already delivers half of its own packages. Currently they're about 85% of the size of FedEx.
I'm not sure it's just about vertical integration.
Amazon is trying to to become better, of course.
But it seems they are focusing on things that customers notice, things that are habit forming, while neglecting other areas where, maybe, most customers(maybe not here at HN), don't notice problems.
So fast, effortless delivery(at a price Amazon can afford) is one. And private brands are also another. And TV. And Alexa.
And i think that's where the main focus of their future investments will go, and not as news portrays - towards making themselves more efficient.
awful logic. they know full well that customer loyalty is their bread and butter. not doing a great job solving one cause of unhappiness does not prove they do not attempt to solve any or all causes of unhappiness!
your logic is equivalent to saying, "since the South did not win the Civil War, it’s obvious they did not really care if they were under Union rule or not"
> reviews that only gripe with the shipping time or condition
I was thinking of just this (i.e. who is held responsible nowadays by customers of mishandled deliveries) while I was watching, a few days ago, a UPS worker actually throwing boxes out of the back of his truck onto the concrete ground while it was raining.
Hopefully none of those boxes were electronics, which would not have survived such poor handling unscathed.
and according to nearly every ups/fedex/usps shipping center worker, that doesn't compare to the abuse they suffer before they're on the truck.
it's why apple put tilt sensors and shock sensors in their bulk iphone shipments overseas. they can't trust the shipping companies to not do that, unless they know they can be caught.
All of those timeframes were Amazon's promises that they decided to make as a result of many meetings and many people being involved in the decision. Who else should be blamed?
I feel the elephant in the room is the question of whether Amazon should be allowed to vertically integrate shipping.
> The consumer has come to expect guaranteed overnight or 2 day shipping.
Amazon doesn't even offer overnight shipping anymore. This is a big step backward from the days when you were allowed to get one-day shipping as long as you were willing to pay for it. I am totally baffled.
Only monopolies aren't allowed to utilize a tying strategy. Every other company is free to. Amazon hasn't been found to be a monopoly in any market AFAIK.
Yeah so I just was searching on that and saw this too... like they would need to be nearly 70% of a market for coercive strategies to be antitrust (although I take it % isn’t the only test). Hard to see how one would define a market where that would be true.
So Amazon is concerned about shipping but not counterfeit goods? This isn't about customers and expectations. It's about Amazon's bottomline. It's a great way to get ppl who already have their wallets open to add Prime.
>> Amazon is reaching further and further into the economy, and I don’t see much stopping them.
Once the government makes them liable for the actions of their 3rd party delivery services, it will. Until then? I agree, there's not much standing in their way.
I've stopped buying from them in light of all the articles detailing the horrendous working conditions and people getting killed because of their contract delivery drivers.
The consumer has come to expect guaranteed overnight or 2 day shipping. When they don’t get that, they get really upset.
Amazon doesn’t want its customers to get upset, and it can’t trust its shipping partners because they don’t have the burden of the consumer sentiment. No one blames FedEx for their late package these days, they blame Amazon. Heck, you don’t have to look hard to find product reviews that only gripe with the shipping time or condition.
Amazon is going to vertically integrate shipping, no question. The market demands it, and Amazon will probably eventually ship more packages than any of its competitors. And, Bezos isn’t dumb, so he’ll build and sell this capacity to others.
Amazon is reaching further and further into the economy, and I don’t see much stopping them.