How Amazon Delivers on One-Day Shipping
Video

How Amazon Delivers on One-Day Shipping

CNBC, 2019

Editorial Rating

8

Qualities

  • Applicable
  • Eye Opening
  • Engaging

Recommendation

In 2005, when Amazon Prime entered the market, one-day shipping was a costly exception. Then Amazon cranked up Prime’s shipping speed from two days to one – and changed everything. One-day shipping doesn’t happen by magic, as Kate Schoolov reports on CNBC. Many people work to ensure every delivery, which Amazon insists happen as smoothly as possible – given that it spends billions on shipping alone. Amazon can now ship more than 10 million products with a one-day turnaround, so customers assume it can deliver just about anything, almost anywhere, by tomorrow.  

Summary

In the second quarter of 2019, Amazon set aside $800 million to ramp up one-day shipping.

Amazon Prime’s one-day delivery, which nearly everyone now expects to provide nearly everything, is anything but cheap. It may be free to Prime members, but in 2019’s second quarter, Amazon set aside $800 million in cash for one-day shipping. The company budgeted this sum to compensate for the dramatically increased transportation and infrastructure costs associated with one-day shipping.

To reduce rising costs, Amazon is scaling down its dependence on UPS and the US Postal Service (USPS) and developing its own logistics capacities. Amazon now executes more than a quarter of its shipping itself. It owns more than 50 airplanes, 300 trucks and 20,000 delivery vans and commands a freighter that runs between the United States and China.

An Amazon delivery...

About the Speaker

Digital producer for CNBC in San Francisco Katie Schoolov shoots, edits and produces videos on the tech industry.


More on this topic

Why Costco Is the Anti-Amazon
6
Education, Disrupted
9
The Currency of Trust
9
Every Company Will Be a Fintech Company
7

Related Channels