Amazon Wants You to Start Your Own Delivery Business

Written by Jennifer Clark
Posted May 15, 2019

On Monday, Amazon (Nasdaq: AMZN) announced a new incentive program. The company says that it is willing to fund up to $10,000 in startup costs and provide three months of pay to any employee who decides to make the jump to owning their own delivery business.

Last June, Amazon was trying to build a program that encouraged anyone — not just employees — to get into the business of last-mile package delivery. But the incentives that were offered at that time still had people struggling with the transition from being employed to being self-employed and working in a competitive market.

Dave Clark, Amazon's senior vice president for worldwide operations, said this in a recent statement:

We’ve heard from associates that they want to participate in the program but struggled with the transition. Now we have a path.

Having these delivery businesses would greatly benefit Amazon, especially if it partnered directly with the smaller companies. Amazon wouldn't have to rely on the United States Postal Service or other major delivery services. Being partnered with multiple, smaller delivery businesses could provide better services for Amazon, enabling quicker and more efficient delivery.

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Over the Thanksgiving holiday, I ordered a new trash can on Amazon.com. I live in the city, and sometimes the packages I have delivered go missing. So it wasn’t a surprise when the package containing my trash can never showed up. This wasn’t the first time this had happened to me — I knew the protocol: wait a few days because the package might show up. If it doesn’t show up, then it’s time to contact Amazon. I went through the Amazon app and contacted customer service. Within five minutes, a new trash can was on its way to my apartment.

However, a week after receiving my new trash can, the one I had originally ordered was at my doorstep. It turns out it was delivered to the wrong address. The person delivering it might have mixed up the house numbers. The recipient of my trash can was probably away on vacation, realized that the package wasn’t for them when they returned, and put it on my doorstep.

I’m sure what happened to me isn’t an isolated incident and is something that Amazon is likely trying to prevent. After all, the company plans to implement single-day shipping (I thought two-day shipping was convenient and adequate enough, but I guess I was wrong), so it wants more reliability among its shippers. Having smaller and more dedicated businesses taking care of deliveries could very well be the answer.

The people who decide to take Amazon up on its offer will get financial assistance and a consistent stream of packages to deliver. Along with that, they will have the opportunity to expand their training and have access to technology to help with their new businesses. These people will also receive discounts on insurance and on Amazon-branded vans and uniforms.

For some, this seems like a no-brainer — you'd be running your own business with a lot of support from a massive company. Not to mention, Amazon is telling owners that they can expect to make a profit of $75,000 to $300,000 a year. One thing to keep in mind, though, is that while Amazon can help you out and provide you with financial backing and technology support, all of that can be easily taken away. The business that you’ve worked hard to manage and maintain could be gone with one decision by Amazon. As long as they carefully weigh the pros and cons, this could be the right decision for a lot of people interested in starting their own businesses.

Until next time,

Jennifer Clark
Pro Trader Today

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