Guess who’s leading the pack in parcel delivery? It’s Amazon, beating out heavyweights UPS and FedEx! Yes, you heard that right – Amazon has taken the crown, dethroning these long-standing carriers in parcel volumes across the U.S.
Just a decade ago, Amazon was seen as a major customer for UPS and FedEx. Back then, skeptics laughed off the idea that Amazon could ever surpass these giants. But my, how times have changed! Amazon’s meteoric growth combined with strategic shifts at FedEx and UPS has flipped the script entirely.
This year before Thanksgiving, Amazon had already delivered a staggering 4.8 billion packages, with projections indicating they’ll hit around 5.9 billion by year-end. Last year, they shipped 5.2 billion packages. That’s some serious parcel power!
But here’s the kicker – these numbers only reflect packages Amazon ships from start to finish. UPS and FedEx tally packages that are eventually delivered by the postal service in their counts.
While Amazon’s dominance keeps growing, both FedEx and UPS have said they’re not racing for volume. They’re more focused on handling more profitable parcels. FedEx even cut ties with Amazon back in 2019. That’s a pretty big move considering Amazon accounts for about 11% of UPS’s revenue!
And get this – this milestone wasn’t marked with grand celebrations at Amazon. Nope, it was more like a casual high-five among execs, and then back to business as usual. That’s how they roll!
What’s fascinating is that a few years back, logistics CEOs found the idea of Amazon being a top carrier downright comical. Fred Smith, FedEx’s then-CEO in 2016, brushed off the thought, saying it was unlikely. But Amazon defied the odds, building one of the world’s largest logistics networks!
Their delivery game got even stronger when they launched a program allowing entrepreneurs to start their own Amazon delivery franchises. This move quickly expanded their network, and today, they have around 200,000 drivers in the U.S., delivering a huge number of packages daily.
During the pandemic, Amazon ramped up its logistics game by opening hundreds of new facilities, almost doubling the size of its network. Dave Clark, former CEO of Amazon’s consumer division and a logistics mastermind, played a key role in this expansion.
They’ve also been regionalizing their network to speed up deliveries and boost profitability. That’s Amazon for you – always finding ways to get your goods to your doorstep faster!
But here’s the deal – Amazon’s success in residential deliveries hasn’t quite translated into a global network like FedEx and UPS have. While they excel at fast deliveries, they don’t have the same widespread pick-up and delivery coverage.
Sure, Amazon’s leading the charge in residential delivery, but they’ve got some catching up to do on the global front. Nonetheless, they’re definitely rewriting the delivery playbook!