Amazon has taken the next big step to establish capacity assurance for its delivery network: Grow it in-house. The Seattle-based company plans to launch a program to recruit hundreds of people to start their own trucking companies and haul goods exclusively for Amazon.
The Seattle company plans to launch a program that employs hundreds of people to start their own trucking company and pull Amazon-only products. An IT reporter reported the news on Friday morning. Brittain Ladd, an e-business consultant and manager at Amazon said Friday she knew last year’s effort and would be “fully operational” by the end of the second quarter. Citing a record within Amazon, Amazon reported that it would build an “incubator” to provide training and loans for entrepreneurs starting their own trucking companies.
Ladd said the idea came about in mid-2018 when Amazon started providing services (DSP). The DSP program’s goal is to fill jobs in the country through selected contracting companies to regulate the number of drivers. It is hoped that the multi-revenue contracts will potentially employ thousands of drivers across the country to expand Amazon’s production capacity.
However, Amazon’s shipments have grown dramatically since then, and the company handles about two-thirds of its shipments in its company, much more than three years ago. As demand for e-commerce continues to grow and more and more drivers retire, Amazon faces the dilemma of whether to contract freight or ship itself. Ladd was completely surprised about this step of amazon as he enquired. Amazon did not respond to a request for comment.
With a market capitalization of about $ 1.6 trillion, Ladd said Amazon should start considering acquisitions at various points in the truck supply chain. The company should investigate the purchase of one or more major truck companies, he said, without mentioning any names.
Amazon should also strongly consider buying the Convoy digital brokerage platform, founded by former Amazon executives and considers Amazon founder, president, and CEO Jeff Bezos as one of its investors, Ladd said.
David Glick, a former Amazon chief executive and chief technology officer at Flexe, an on-demand warehouse company, said Amazon’s promotional campaign is more focused on the industry’s future than today. “Amazon always plants seeds that will grow into trees after five to seven years, so they’re looking at the ability to deliver several years out,” Glick said.
Ladd said Amazon needs to build an image from the ground that is not important by placing trucks on the roads. However, the company should make a “consortium” of company trucks, including sponsored vessels. Under the combination of models, any car in the consortium would pull a trailer, and any driver would drive a car, Ladd said. “It will ensure that the trucks can operate almost immediately because the drivers who have driver access will be able to maintain the movement of the trucks,” he said.