Amazon announced on Thursday that they will enter the package delivery industry alongside UPS, DHL, and the U.S Postal Service. They call it the Delivery Service Department program, a program that offers incentives to people who want to deliver packages for Amazon. These incentives include branded uniforms, discounted Amazon-branded vehicles, fuel, and insurance coverage.
Dave Clark, Amazon SVP Worldwide Operations, issued the following statement:
“We have a great relationship with all of our core providers. Whether it’s UPS, USPS, FedEx, DHL, around the world we are in all the above supply chain. We use everything in order to meet our scale and to meet our needs and I don’t see that changing in the future.”
Clark went on to say that the program is “much more about customer experience and meeting overall growth. We think this is going to be a cost-effective way to do that”.
The success of the program depends on the amount entrepreneurs that decide to start their own delivery business.
Business Insider reported that running a delivery business for Amazon has an annual profit potential of $300,000. Amazon stated that this kind of business would likely involve operating up to 40 delivery vehicles. A $10,000 investment is the minimum requirement to participate in Amazon’s delivery program. You can simply apply to be part of the program through the Amazon website.
The application requires answers to the following questions:
Are you a military veteran?
Do you have experience building and developing a team?
Are you ready to commit to being a hands-on DSP owner full time?
Have you ever owned and operated your own business?
Have you or a business you owned ever declared for bankruptcy protection?
Do you have at least $30,000 in available liquid assets?
Amazon stated that their shipping costs, including delivery center, sorting, and transportation expenses, increased from $11.5 billion in 2015 to $21.7 billion in 2017. These costs are scheduled to increase. Amazon is optimistic that the Delivery Service Department program will counteract their increasing shipping costs. Time will tell.
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