One of Amazon’s highest priorities is to get its packages out to customers.
To combat the current difficulties of hiring additional drivers, in the tightest U.S. labor market in 50 years, Amazon is offering to have its own people leave their employment with the company and hire them back as independent contractors to drive the vans. In the past, Amazon has relied on the USPS to a large extent to deliver its packages but is now interested in being able to handle more of the package delivery in-house. Since last June, the company has had a program for entrepreneurs to form local delivery operations in leased vans bearing the Amazon logo. About 200 firms have been founded to provide these services. This week, in an attempt to create several hundred more driving/delivery opportunities, Amazon announced that it would give its existing employees $10,000 each for startup costs as well as the equivalent of three months gross salary if they start their own delivery businesses. This represents a modest investment by the company which is likely to garner the several hundred employees to take up the offer, from their pool of 650,000 full- and part-time workers. The new offer is an attempt to add people faster to the delivery services. As the pool of Amazon delivery drivers grows, the company is expected to cut back on the “last mile” deliveries that it currently gives to UPS and Fedex. An analyst has forecast that the Amazon program could handle half of all last-mile deliveries by 2022. Focusing on its own employees to expand delivery services makes good sense, as those employees have already been vetted and have a proven record with the company. The new program is couched in terms of the company’s “long history of providing help to our employees,” by a company spokesperson. The program was in the works before Amazon announced that it was moving to one-day delivery for Prime members. “Part of the effort to speed up delivery to our customers,” the company representative stated. With this program enacted, Amazon is building out a network of delivery stations to help speed parcels to its consumers. Packages are sorted by route and then handed off to local delivery partners. The company is expanding those stations past the big cities and moving into smaller markets, as well. “They’ve already conquered the big cities,” one analyst reports and cites the 115 locations in metropolitan areas and 10 more in progress. Employees who elect to take advantage of the new program are guaranteed a consistent delivery flow as well as access to Amazon’s delivery technology and Amazon-branded vans. The new delivery services would also be supplied with branded uniforms and insurance. An interesting concept – this is what we, in the business world, call “growing your own.”