Amazon is quietly building an army, but it's something bigger than drones flying past your bedroom window (for now, anyway). Instead, the retail giant has been laying groundwork to create a massive delivery network that may eventually compete with its shipping partners, according to a Wall Street Journal report.
The company's pursuits to "heavily" supplement shipping services, Amazon executives have said, has always been a top priority--especially during the busy holiday season. The company hopes to not only deliver all its own merchandise, but someday also deliver packages on behalf of other retailers.
Amazon began ramping up its in-house delivery capabilities after UPS disappointed customers with late deliveries during the 2013 Christmas season, costing the retailer millions in refunds. It also began hiring away executives from UPS and FedEx, sources told theJournal.
The mission to take logistics in-house, however, is much more comprehensive than it seems. Making this kind of delivery network profitable requires huge scale, and despite Amazon's size, logistics experts say the company doesn't have enough customers yet for an efficient execution.
FedEx and UPS executives might be scoffing at Amazon's ambitious plans. (The two logistics companies operate out of about 4,000 global locations, handling millions of packages daily.) But the retail giant already has facilities within 20 miles of 44 percent of the U.S. population, which is a clear indication of Amazon's desire for more control over its delivery chain.