Beyond Prime Air, its ambitious drone delivery program, Amazon has been quietly buying up thousands of truck trailers to better support shipping between its fulfillment centers and looking into leasing its own fleet of Boeing jets.
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Fresh produce is currently only available to Prime Now users in Milan and its surrounding area, but the service is expected to be offered in other locations if it proves successful.
Amazon Flex is working like on-demand ride-hailing service, Uber. The drivers can also set their shifts between 8 AM and 4 PM during seven days a week.
Taking on the likes of Postmates and GrubHub, Amazon’s Prime Now will deliver meals from more than 90 restaurants, including Carnitas’ Snack Shack, Native Foods and Urban India. Drivers will be paid $18-25 per hour and they will have to pay for their own fuel and insurance costs.
Amazon says its average delivery time is 39 minutes in areas that it already dispatches food, so San Diego residents can expect the same level of promptness.
It might also create a logistics network to compete with United Parcel Service Inc, FedEx Corp and the patchwork of local carriers which now deliver Amazon packages. Expanding Amazon Flex beyond Prime Now orders will open on-demand delivery for over 200 million products listed on the primary Amazon.com platform, which would help drive sales.
There is a real potential to save on shipping costs for Amazon, which soared to $11.5 billion in 2015, assuming the program works out, Reuters reported.
The move could be especially cost-effective in out-of-the-way areas where smaller, regional couriers deliver parcels to Amazon customers.
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Amazon has ramped up efforts in recent months to attain greater control over its global supply chain. Although the company indicated in the past that its plans will not threaten traditional courier partners and are simply an extension of the distribution network, courier services will certainly feel the heat. The big question now is how far Amazon plans to take home delivery?
