It’s not long since the news of Amazon and FedEx’s conflict came to light. Now Amazon and FedEx are getting along again. So what will be the impact of the two companies getting back together?
Amazon is an international cross-border e-commerce giant.
FedEx is an international express delivery group that provides overnight express, ground express, heavy cargo delivery, document copying and logistics services . It is headquartered in Memphis , Tennessee , USA, and is affiliated to FedEx Corp.
A month ago, on December 17, Amazon announced that it would ban sellers from using FedEx for delivery services because FedEx's logistics timeliness was relatively slow, affecting the delivery of express parcels.
The decision caught many third-party sellers off guard during the busy shopping season. Some sellers have been forced to find new carriers and may face higher upfront costs as a result. Other sellers said they were frustrated by FedEx service delays.
Recently, Amazon announced that third-party sellers can continue to use FedEx's ground delivery service. FedEx's stock price rose as much as 3% after the announcement and closed up 1.8% that day.
According to CNBC, an email sent by Amazon to merchants on Tuesday showed that the company will resume FedEx's ground and home delivery services at 5 p.m. Eastern Time on January 14. An Amazon spokesperson confirmed that the company will resume ground delivery service on Tuesday. The spokesperson said FedEx Ground and Home services have always met Amazon's on-time delivery requirements, so the shipping options for Prime orders have been restored.
A FedEx spokesperson also confirmed that Amazon lifted the ban and said FedEx's service levels performed well during the holiday peak, with an average delivery time of 2.4 days for ground packages and 18% of ground packages delivered ahead of schedule.
In recent years, while expanding its business territory, Amazon has also accelerated the expansion of its delivery network. It is reported that Amazon has gradually distanced itself from FedEx and UPS by building its own delivery network.
It is understood that in its annual report in February 2018, Amazon added "transportation and logistics services" to its list of competitors for the first time. In May, it launched a new express service partner program to encourage employees to leave their jobs and start express delivery companies, and also expanded its air cargo aircraft to 50 so that it does not have to rely on FedEx and UPS.
Amazon's various actions in logistics intensified the competition with FedEx, ultimately leading to a "breakup".
In the long run, the termination of the cooperation between the two parties caused FedEx to lose a major customer, and as Amazon's logistics service capabilities continue to increase, FedEx has to face a more intense competitive environment.
It took only a month from the ban on sellers using FedEx for delivery services to Amazon’s announcement that it would resume FedEx services for third-party sellers, but it caused losses to both companies and sellers to a certain extent.
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