Amazon is building a global fulfilment network to grow it’s Amazon Logistics delivery business according to a report by Bloomberg.
As far back as 2013, an internal report code named ‘Dragon Boat’ envisaged a flow of goods from manufacturers in China and India through Amazon Logistics shipping, arriving at local Amazon warehouse in the west and then with Fulfilment by Amazon being sold and sent out with Amazon’s local couriers to the end customer.
Not only will this enable merchants in the West to source goods from the East, but it would also give Chinese and Indian merchants easy access to sell on Amazon’s European and American marketplaces direct from their factories.
Bloomberg say that a new “Global Supply Chain by Amazon” could launch as early as this year and it’s not just the physical shipping that they’ll take care of. They’ll also handle all the import paperwork for customs clearance that retailers normally have to complete to take care of customs requirements.
Far from simply being a threat to eBay and marketplaces in the West, a new global supply chain enabling the flow of goods from the factory to the consumer via Amazon Logistics and Fulfilment by Amazon (FBA) puts them in direct competition with Alibaba, who are also building out their European operations to facilitate commerce with China.
Currently Amazon have downplayed the threat to couriers and national mail carriers, but the Bloomberg report suggest that Amazon will simply partner with traditional carriers until they have the scale and experience to take everything in-house. This is of course what pretty much everyone believes, but not what Amazon have said publicly.
We’ve already know that Amazon will replace UK carriers for Amazon Prime eligible self fulfilling merchants. We would expect this program to rapidly expand, but it looks likely that this is the least of Amazon’s logistics aspirations.