Business

Amazon Is Creating Its Own UPS/FedEx

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INGLEWOOD, CA - JUNE 27:  An Amazon Fresh truck arrives at a warehouse. AmazonFresh lets you order groceries and have them delivered on the same day. (Photo by Kevork Djansezian/Getty Images) INGLEWOOD, CA – JUNE 27: An Amazon Fresh truck arrives at a warehouse. AmazonFresh lets you order groceries and have them delivered on the same day. (Photo by Kevork Djansezian/Getty Images) Photo of Eric Lieberman

10:15 AM 02/09/2018

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Amazon is set to start a new shipping service that will directly compete with more entrenched, longstanding companies like UPS and FedEx, according to The Wall Street Journal.

While operations will only start off in the Los Angeles area in the near future, the tech conglomerate plans on gradually expanding its service known as “Shipping with Amazon” (SWA) to several other major cities around the country. The facilitating of parcel distribution would be centered on businesses and their delivery to consumers, rather than the other way around.

Amazon may try to offer cheaper prices than its imminent competitors, undercutting them in the process, reports TheWSJ.

UPS indirectly tried to one-up Amazon after it tested unmanned aerial vehicles, or drones, and their ability to work hand-in-hand with their normal supply chain processes. But UPS and FedEx aren’t the only corporations Amazon has to worry about.

Walmart announced in November 2017 that it acquired Parcel, a same-day delivery startup, in an apparent attempt to keep pace with Amazon’s growing infrastructural power while vamping up its own services. Prior to the announcement, Walmart already agreed to acquire Jet.com, and expressed a desire to buy Bonobos, a strictly online retailer.(RELATED: Amazon Wants To Open 2,000 Grocery Stores In The Next Decade)

Regardless, Amazon may not actually be concerned about traditional companies like UPS and FedEx, and even Walmart, because as it tries to carve out a stake in almost every industry — like cloud computing technology and film and show production — it can afford to take chances and underprice competitors in certain spheres of the economy.

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