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A recent Barron’s headline read, “What Amazon Will Destroy Next.” While that might be alarmist, it’s fair to ask, what will Amazon disrupt next? And with its latest actions, the company is getting closer to becoming a real challenger in two industries: delivery and apparel.
Through a new program called Seller Flex, Amazon will manage package delivery from third-party merchants to customers. While Bloomberg said this development doesn’t necessarily cut UPS and FedEx out, Wall Street’s reaction to the news, which caused shares for the delivery giants to tumble, suggests the move is expected to have negative effects on their businesses.
Seller Flex, which is in trials in the U.S. and has been operational in India for two years, would allow the retailer to save money, free up space at distribution centers and provide more products via free two-day delivery. It would also essentially expand the number of Amazon’s distribution centers to include all seller’s warehouses.
This newest service builds on Amazon’s network of fulfillment options like its relationship with the U.S. Postal Service, which handles last mile deliveries; Fulfillment by...