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Amazon Logistics: What Is It and How to Master It

For the most experienced seller and Amazon customer, their answer to the question that if Amazon Logistics is a friend or foe, is still uncertain. The results are also affected by the quality of service from different delivery provider.

We’re going to talk about the details about this Amazon shipping method in this passage. We will list the advantages and disadvantages and provide some solutions for FBA sellers to consider.

The Basics

Amazon began their Amazon Logistics shipping service to fulfill 2 goals. One is reducing shipping time and the other is increasing customer satisfaction. You might have heard of the same-day delivery option. Prime might be a exceptional concept but the thrill of putting an item in your virtual shopping cart and having it arrive at your door 2 hour later on a Sunday is way more mind-blowing.

As a Prime memeber perk, this elite shipping service is free of charge. If non-members are willing to pay a little more money, this service is also available. However, only certain Amazon’s designated service areas are available. Luckily, these areas are on expand and every day with new fulfillment centers are popping up in North America and the UK.

This is an anomaly that disrupt traditional shopping logistics continuously in the ecommerce world. Instead of replacing carriers, Amazon claims their shipping service provides customers in a hurry with an alternative option.

However, it seems to be only the start of amazon’s expansion into express delivery domination. Increasing surmise that it may compete with traditional carriers is something worthy attention. Let’s dig into how this work…

How does it work?

Amazon Logistics, much like the Uber car-share business model, relies on contractors to run this service with a few more expert requirements. To become an official Amazon Delivery Provider, the individual or company must meet the following criteria.

1. They must be fully licensed with commercial and automotive insurance, workers compensation and Cargo Legal Liability, which means they’re an established last-mile delivery company.
2. The company must have experienced and trained drivers with documented driver safety training and policies.
3. The company must have professional cargo vehicles that must be able to hold at least 300 cubic feet of goods, depending on location, walkers and other features.

It sounds like Amazon is crossing their t’s and dotting their i’s. However there isn’t enough oversight to guarantee the service will be executed to the highest degree of Amazon’s expectations as with any contracted third-party.

The flexibility to choose the cities where they would like to deliver and their hours of service throughout the day is appreciated by Delivery Providers, which includes early mornings and late evenings, 7 days a week. They even use routing technology provided by Amazon to navigate their deliveries. But their operating totally independently even they wear the same shirt with Amazon logo.

This is creating a huge shift in the shipping field because because It depends so heavily on the independent contractors who are outsourced for on-demand jobs and public services to deliver the last mile. It’s the new-born business model for efficiency, but it comes with its pitfalls.

How do FBA sellers benefit from it?

To be honest, this largely relies on how actively hands-on you’re with each of your customers. Most sellers are not even aware of the shipping method selection and have trust in each carrier. They believe they will follow through the process. As long as you have a follow-up process in place for feedback and review requests,there isn’t much else you can do to influence the delivery status.

Not to mention, any negative feedback or reviews directly related to the shipping experience and expectations are immediate reasons to remove it. Thus try to keep your reputation intact. However, it’s still important to know which service that could be a hit or miss for the customers.

Knowing what to expect with FedEx, UPS and US Postal Service, the expectations of consumers are undoubtedly raised by the promise of same-day delivery. Amazon, as a customer-first company, does not make you, the third-party seller, the intended beneficiary of these types of services Amazon continues.

Let’s talk about the pros and cons

Pros:

  • The fastest delivery options which makes your accessibility to programs such as Lockers, Fresh, Flex and Prime Air, are provided to your products to offer expedited service. Same-day and even 2-hour shipping are possible in specific geographic locations (more on those below!)
  • A new map tracking feature is added to Amazon Logistics the year, which makes customers easier to follow the journey of their package and even receive photo confirmation of the delivered parcel on their front porch.
  • Even when other carriers are slowing down due to seasonal and other high shipping volume variables, Amazon Logistics is able to keep up with demand and avoid overcrowding in the warehouses.
  • The combination of external partners and internal teams allows for global growth (expands the marketplace for your products) and new initiatives like the ones below –

Amazon Lockers: Secure, self-service kiosks where customers can pick up Amazon.com packages at a time and place that is convenient for them. Option available during checkout for select cities.

Amazon Flex: A courier service in 50+ US cities, offering same-day delivery. Couriers only need a car, smart phone, and simple background check to start delivering.

Amazon Fresh: A grocery delivery and pickup service available exclusively to Prime members in select cities.

Prime Air: A delivery system from Amazon designed to safely get packages to customers in 30 minutes or less using unmanned aerial vehicles, aka drones.

Cons:

  • Sellers have no choice but are served by delivery provider assigned by Amazon Logistics which means any negative experiences with a provider could probably be repeated.
  • It’s neglecting insightful suggestions to improve the process that Amazon Logistics operates without seller input guiding their policies and procedures.
  • According to reviews across the internet, many independent delivery companies don’t always follow the proper protocol if a package is undeliverable. The dreaded “return to sender” is enforced with little explanation for the delivery mishap, and lost packages marked as “delivered” are head scratchers.
  • What can you do to reduce the risks of using Amazon Logistics?

    Your sales and reputation are always at stake. The best plan of action is to be as proactive as possible from the point of sale through the delivery.

    • One easy good way to reduce the risk is implementing an automatic messaging system to request seller feedback immediately upon receiving your product. Once a package is marked as delivered, trigger the message!
    • Make sure you’re accessible to your customer which means you should provide as many contact options as possible to your customers. Thus any shipping errors won’t be a reflection of negligence on your part as you’re always ready to help. You can provide multiple links such as tracking link, feedback link, Amazon storefront link, etc.
    • Sellers has an option to deprioritize Amazon Logistics as their least preferred shipping method by reaching out to customer service, which may push customers toward other shipping options. On the other hand, customers can also request this too if they’re unsatisfied with the service.

    For sellers, this means communication is priority with customers. If you start to implement above advice, you can ahead of any disappointing experiences and still benefit from all of the positive intentions for the Amazon Logistics service.

    What’s the future of Amazon Logistics?

    Amazon seems to continue to enlarge their shipping network, competing with major national carriers in 2018.

    Analysts say it could take decades to take over the competition, but if these logistical leaders can’t keep up with the innovative platform that Amazon is building, we could witness an inevitable takeover on the fulfillment front. Anything is possible as Amazon is already providing drone deliveries. Their operational strategy could even expand into freight forwarding until they are hand-holding your product from start to finish.

     
     
     

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