Amazon is looking to expand its independent reach over the shipping industry, which means they are making big leaps to invest in their own shipping methods. Of course this also indicates fewer Amazon shipments for other businesses in the shipping industry, and it could lead to quite a devastating blow to USPS and UPS shipping.
How Amazon is Expanding Its Empire
Recently Amazon ordered 20,000 delivery vehicles, but that’s not the only thing Amazon is doing which could hurt UPS Ground and USPS First-Class Mail. Amazon even lets people use their own cars for delivery in certain cities, and Amazon Air is expanding to include 50 new planes. There are also several new regional hubs opening. The result of all of this is that 26% of online orders are now being handled directly by Amazon. Two-day shipping will be possible almost any place in the United States as a result of this air network that is funded by Amazon, and this could certainly rival USPS Priority Mail Express and UPS Overnight.
It’s only a matter of time before Amazon qualifies as a logistics company, and in fact most likely a top logistics provider. This may be either through air or delivery vehicles, or possibly even both. The main question that remains is how long it takes before Amazon reaches the peak of what it will come to be in the shipping world, and how USPS, UPS and even FedEx will handle the problem. In fact this isn’t the only risk factor these companies have to be concerned about, if one of their major customers took their deliveries somewhere else or demanded lower shipping rates it could also really hurt these companies.
It’s not all bad news just yet for UPS shipping, because they have 119,000 last-mile vehicles and this new order of 20,000 shipping vans by Amazon rather pales in comparison. Still, Amazon likely has greater independence in mind and it will no doubt lead to relying less on logistics companies like USPS.
What Competing Companies Can Do
1. Providing a better customer service
While we know what the future probably looks like regarding Amazon, one of the more important matters to be addressed is how other companies can compete. A first line of defense is always going to be customer service, especially for smaller companies. Being able to give more personal, helpful, quality customer service is much easier for smaller businesses than any giant corporations.
2. Adjust your pricing strategy
It’s also important not to try to slash prices too much to compete with Amazon, because this is a losing battle. The best thing to do is figure out the minimum you can charge without losing money and don’t cross that line. You have to react quickly because Amazon constantly changes the prices of the listed products almost every 10 seconds!
3. Engaging your audience
Premium online content is another edge that a business can take advantage of when trying to stay ahead of Amazon. All Amazon really offers is a transnational space, but other businesses can make more of their websites by adding blog posts, videos, customer guides and advice, and other unique and interesting content that will keep people coming back to their sites. Even if someone doesn’t buy something from the site, it could still create a positive experience that increases the chances that they will return.
4. Saving money on shipping
You should also look to cut shipping costs by searching for the best options available. Check USPS and UPS shipping rates. One of the best methods of doing this is checking a UPS or USPS shipping calculator. Saving money in whatever ways you can will help you keep your own prices lower without losing money, and shipping is a great place to start, because it’s an automatic necessity for anyone who delivers products. By choosing to support the shipping industry you will also help other businesses struggling against Amazon.