Postal services are already under pressure because people are sending fewer letters by mail, but Shipping by Amazon could mean their envelope is well and truly licked.

Amazon is quietly testing a new service in the US, which would bring the company one step closer to autonomy — and further from the reliance on human workers.

Go deeper with GlobalData

Premium Insights

The gold standard of business intelligence.

Find out more

Related Company Profiles

View all

The success of Amazon can largely be attributed to its convenient service. The company, under the orders of founder and chief executive Jeff Bezos, has always sought ways to speed up its shipping services and ensure the highest levels of customer satisfaction.

It has algorithms that anticipate orders, ultra-efficient robots working in its warehouses, and now a same-day delivery service. Other online retailers have so far failed to provide such a sophisticated service and Amazon has grown to dominate the market.

The company is currently only testing Shipping by Amazon in Los Angeles, although it has not yet announced plans to execute the plans globally.

Although it may take years for Shipping by Amazon to become fully fledged, the company’s non-traditional delivery tech — including drone delivery and Amazon Key — will likely help it along the way.

How well do you really know your competitors?

Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.

Company Profile – free sample

Thank you!

Your download email will arrive shortly

Not ready to buy yet? Download a free sample

We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form

By GlobalData
Visit our Privacy Policy for more information about our services, how we may use, process and share your personal data, including information of your rights in respect of your personal data and how you can unsubscribe from future marketing communications. Our services are intended for corporate subscribers and you warrant that the email address submitted is your corporate email address.

However, one major hurdle is regulation — which is becoming Bezos’s biggest headache in the US under President Donald Trump.

Trump has recently accused Amazon of using the US Postal Service as its “delivery boy” and urged the company to pay more tax, but the issue is more complicated than that.

Amazon has, unsurprisingly, been under fire for tax avoidance many times – in 2017 it was ordered to pay €250m ($320.5m) by the EU because of what was called “illegal tax advantages”. Although the US Postal Service has suffered mainly due to a lack of demand for traditional letters.

The service is being kept afloat by the increased uptake of package delivery and if Amazon were to expand its services, global postal services, such as the US Postal Service, would suffer.

Shares for FedEx Corp and UPS were down more than 4% after the news of Shipping by Amazon broke in early 2018. Both companies only make a small fraction of their profits from delivering Amazon products but competition from the company would be fierce.

Logistics giants likely do not need to worry quite yet, but they are probably aware that Amazon could compete aggressively — as it has done elsewhere.

Despite the problems of using drones to deliver a package or allowing a delivery driver access to people’s homes, there are numerous individuals already embracing modern ideas. If Amazon can convince its customers that these methods are the next step, delivery services in the future will look very different.