Amazon now delivers more packages than FedEx

For many years, FedEx, UPS and the US Postal Service have almost controlled the last-mile delivery market in the United States. But the latest report shows that Amazon Logistics has delivered more packages than FedEx.

According to Pitney Bowes data, Amazon is now one of the top service providers for package delivery. In 2020, Amazon Logistics delivered 4.2 billion packages, up from 1.9 billion in 2019. Currently, by volume, it accounts for 21% of all US package shipments, second only to USPS (38%) and UPS (24%), and ahead of FedEx (16%) for the first time.

Amazon's logistics development speed is indeed amazing. It has only opened its transportation and warehousing network to third-party sellers in the past decade. In 2014, Amazon delivered only 20 million packages, while last year it reached 4.2 billion.

It is understood that Amazon Logistics, UPS, USPS and FedEx have a high market share. In terms of quantity, these service providers account for 99% of the total parcel volume in the United States.

Although Amazon's infrastructure is comparable to that of FedEx and UPS in every way, its revenue figures still pale in comparison to those of UPS and FedEx, despite its certain advantage in package transportation volume.

Pitney Bowes estimates that while Amazon Logistics has 20% of the market in terms of volume, it only accounts for 10% of revenue, compared with 34% for FedEx and 35% for UPS.

Amazon Prime can explain these disparities to some extent. Individual customers usually need to pay UPS and FedEx for shipping each package, but Amazon Prime provides free delivery to its customers in exchange for the subscription.

This means that Amazon Logistics earns a different profit per package than its competitors, with an estimated revenue of $4.30 per package .

In addition, compared with UPS and FedEx, Amazon's cargo aircraft fleet still has a lot of room for development. It is understood that by the end of 2021, Amazon's cargo aircraft fleet is expected to reach 80, while UPS has 275 and FedEx has 463.

Still, Amazon continues to expand its presence in the fulfillment market. In recent months, Amazon has launched its Multi-Channel Fulfillment Program, which allows brands that sell on non-Amazon platforms to share warehousing and shipping with Amazon, its first attempt to become an independent operator like UPS and FedEx.

Obviously, in addition to being a technology company and a retailer, Amazon is also gradually becoming a logistics company and a logistics fulfillment service provider.

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