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1337Delta764
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FedEx Ground ends Amazon contract

Wed Aug 07, 2019 7:19 pm

https://www.cnbc.com/2019/08/07/fedex-t ... mazon.html

Just two months after FedEx Express ended its agreement with Amazon, looks like the Ground division has now followed suit. I'm not too surprised by this.
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casinterest
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Re: FedEx Ground ends Amazon contract

Wed Aug 07, 2019 7:40 pm

Not surprising with all the Prime Mercedes ground trucks everywhere now. With USPS contracts, Amazon is poised to deliver big.
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Ken777
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Re: FedEx Ground ends Amazon contract

Thu Aug 08, 2019 1:46 am

Give it to the Post Office - they can use the money and have daily coverage all over the cities/towns. I'm especially hopeful that it will allow for increasing hiring as well as maintaining basic postage rates.
 
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trpmb6
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Re: FedEx Ground ends Amazon contract

Thu Aug 08, 2019 2:48 am

We have sunday coverage from USPS. Why bother with fed ex at this point.

I'd be interested in more financials behind it but my understanding is that amazon only accounted for 5% (or less) of FedEx's deliveries. So it's not really a big deal.
 
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1337Delta764
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Re: FedEx Ground ends Amazon contract

Thu Aug 08, 2019 1:55 pm

trpmb6 wrote:
We have sunday coverage from USPS. Why bother with fed ex at this point.

I'd be interested in more financials behind it but my understanding is that amazon only accounted for 5% (or less) of FedEx's deliveries. So it's not really a big deal.


I almost never get Amazon deliveries from FedEx besides those shipped directly from third party sellers. I have never gotten anything via FedEx Home Delivery, and the only time I have gotten FedEx Express was a paid upgrade to one-day shipping.
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trpmb6
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Re: FedEx Ground ends Amazon contract

Thu Aug 08, 2019 3:20 pm

1337Delta764 wrote:
trpmb6 wrote:
We have sunday coverage from USPS. Why bother with fed ex at this point.

I'd be interested in more financials behind it but my understanding is that amazon only accounted for 5% (or less) of FedEx's deliveries. So it's not really a big deal.


I almost never get Amazon deliveries from FedEx besides those shipped directly from third party sellers. I have never gotten anything via FedEx Home Delivery, and the only time I have gotten FedEx Express was a paid upgrade to one-day shipping.


Come to think of it you're right, whenever I requested one day delivery it came via FedEx. Though I suppose that makes a lot of sense due to logistical capabilities.
 
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casinterest
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Re: FedEx Ground ends Amazon contract

Thu Aug 08, 2019 3:25 pm

The scary part for UPS and Fed Ex is that Amazon is their direct competitor now.
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910A
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Re: FedEx Ground ends Amazon contract

Thu Aug 08, 2019 3:39 pm

1337Delta764 wrote:
trpmb6 wrote:
We have sunday coverage from USPS. Why bother with fed ex at this point.

I'd be interested in more financials behind it but my understanding is that amazon only accounted for 5% (or less) of FedEx's deliveries. So it's not really a big deal.


I almost never get Amazon deliveries from FedEx besides those shipped directly from third party sellers. I have never gotten anything via FedEx Home Delivery, and the only time I have gotten FedEx Express was a paid upgrade to one-day shipping.


Well considering FedEx only received 1.3% of their income from Amazon, I doubt the chances of getting a Amazon delivery from FedEx stateside was pretty small..
 
Kiwirob
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Re: FedEx Ground ends Amazon contract

Thu Aug 08, 2019 5:59 pm

casinterest wrote:
The scary part for UPS and Fed Ex is that Amazon is their direct competitor now.


Is Amazon delivering for business outside there own?
 
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casinterest
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Re: FedEx Ground ends Amazon contract

Thu Aug 08, 2019 6:07 pm

Kiwirob wrote:
casinterest wrote:
The scary part for UPS and Fed Ex is that Amazon is their direct competitor now.


Is Amazon delivering for business outside there own?


Amazon uses outside sellers to move products, and then allows them to use the fulfillment center, They pay amazon fees, but they are still independent business.

Now for business to business shipping, Fedex .....etc are still king, but if you follow the logic, this move to stop using FedEx means Amazon is ready to tap that market too.
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trpmb6
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Re: FedEx Ground ends Amazon contract

Thu Aug 08, 2019 7:32 pm

casinterest wrote:
Kiwirob wrote:
casinterest wrote:
The scary part for UPS and Fed Ex is that Amazon is their direct competitor now.


Is Amazon delivering for business outside there own?


Amazon uses outside sellers to move products, and then allows them to use the fulfillment center, They pay amazon fees, but they are still independent business.

Now for business to business shipping, Fedex .....etc are still king, but if you follow the logic, this move to stop using FedEx means Amazon is ready to tap that market too.


I get what you're saying here but I don't think you fully appreciate the volume that FedEx operates at vs Amazon's current volume capability.

DHL tried to do it in the states and failed miserably and gave up.
 
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casinterest
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Re: FedEx Ground ends Amazon contract

Thu Aug 08, 2019 8:07 pm

trpmb6 wrote:
casinterest wrote:
Kiwirob wrote:

Is Amazon delivering for business outside there own?


Amazon uses outside sellers to move products, and then allows them to use the fulfillment center, They pay amazon fees, but they are still independent business.

Now for business to business shipping, Fedex .....etc are still king, but if you follow the logic, this move to stop using FedEx means Amazon is ready to tap that market too.


I get what you're saying here but I don't think you fully appreciate the volume that FedEx operates at vs Amazon's current volume capability.

DHL tried to do it in the states and failed miserably and gave up.


No doubt, but Amazon is a company with a lot more market cap and market penetration. Think of all these drivers they now have driving around in Prime vans. They will just slowly work their logistics into the business world. DHL didn't have a lot of preestablished market penetration with all the businesses that needed stuff shipped. There is a lot of meetings that have to happen for big companies that ship big volumes.
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trpmb6
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Re: FedEx Ground ends Amazon contract

Thu Aug 08, 2019 11:38 pm

True. But what is an amazon prime van? Never seen one. But that may be the Kansas effect. Maybe they have more penetration (hehe) than I realized in the bigger markets.
 
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cjg225
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Re: FedEx Ground ends Amazon contract

Sat Aug 10, 2019 2:05 pm

trpmb6 wrote:
I get what you're saying here but I don't think you fully appreciate the volume that FedEx operates at vs Amazon's current volume capability.

DHL tried to do it in the states and failed miserably and gave up.

Where Amazon might become a threat is in the high-volume/high-density corridors. That's how they got to a point where they could justify, financially, having the network that they're growing.

But, I am very big Amazon cynic and am very suspicious of their ability to actually seriously compete with UPS and FedEx. They will push (and have pushed both) to make changes and improvements, but they won't be able to seriously harm either's market share or penetration. Amazon's network is still a tiny fraction the size of the Big 2.

Furthermore, what always gets lost in all of this is how much money Amazon loses doing all of this. UPS and FedEx do not.
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EstherLouise
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Re: FedEx Ground ends Amazon contract

Sat Aug 10, 2019 11:35 pm

trpmb6 wrote:
But what is an amazon prime van? Never seen one. But that may be the Kansas effect.


I see them around MSP.
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frmrCapCadet
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Re: FedEx Ground ends Amazon contract

Sun Aug 11, 2019 12:25 am

The pattern is likely to be the same: Amazon establishes a fairly comprehensive retail shipping and delivery arm, and then looks at what high margin business they can poach from FedEx.
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