Amazon backs entrepreneurs to form new package delivery service

Amazon wants to create some new opportunities for business owners.

In response to the exploding e-commerce industry and the need to bring those parcels and packages more quickly to customers, Amazon is encouraging aspiring entrepreneurs to deliver packages for Amazon Prime.

Here’s how it works: with an initial investment of at least $10,000, an individual can lease five Amazon brand vans. The business onwer will be plugged into Amazon’s software which will determine where the drivers should go.

With the support and backing of the online retailer, the business owners will qualify for lower rates on insurance and fuel. According to Amazon, an owner will be able to make as much as $300,000 a year in profits by operating a full-sized fleet of 40 vans and managing 100 employees.

Developing an army of independent delivery partners will benefit Amazon in covering the so-called “last mile” in its delivery system, which is the final leg between the shipping center and the customer’s doorstep.

Currently, third party operators such as FedEx, United Parcel Service and the United States Postal Service handle most of the last mile logistics.

By shifting that function to hundreds of these new small businesses, Amazon gains greater control over the delivery process and the customer experience while avoiding the added tasks of operating the vehicles and managing employees.

Steven Osinski, who teaches marketing at San Diego State’s School of Business said the end result is giving Amazon more influence. “I think Amazon’s ultimate goal is to control the air, the trucking as well as the last mile,” Osinski said.

The marketing expert said the delivery business is also a good opportunity for the motivated entrepreneur. “I think it’s people who basically have been in some level of business and they finally want to have the experience of starting their own business. The economy in America is thankfully, doing well right now for many people and as a result, I think a lot of people are saying ‘I want my fair share of that.’ This is an opportunity and having Amazon backing you up increases your chances pretty significantly,” Osinski said.

President Trump has been critical of Amazon’s use of the U.S. Postal Service, saying the Postal Service is losing money at taxpayers’ expense by being used so intensively by Amazon.

The Postal Service said its contract with Amazon does in fact, cover its costs. However, those claims may be take on less signficance as Amazon moves forward with the formation of hundreds of private delivery services.

If you are interested in learning more about the business opportunity, there is information on Amazon’s website: https://logistics.amazon.com/

Categories: Local San Diego News, Trending

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