Amazon is reportedly developing a ‘crowd-sourcing’ mobile app to allow ordinary people to deliver packages to parcel recipients instead of using parcel carriers such as UPS, FedEx or DHL to save money and to speed up the delivery process, according to the Wall Street Journal.
The plan is to use local retailers in urban areas to store the packages by renting space from them or paying a per-package fee, people familiar with the matter told the newspaper. They couldn’t indicate, however, the approximate date when the crowd-sourcing project, known internally as “On My Way” would start. It is also possible that the e-commerce giant will not move ahead with it at all. An Amazon spokeswoman declined to comment.
The main goal of the project is to reduce Amazon’s shipping costs that increased 31% last year, faster than the company’s revenues. This way, Amazon would also have more control over the shopping experience. “It also might give the retailer negotiating leverage with the largest carriers,” the Wall Street Journal said.
However, there are several potential issues related to the concept, according to experts. On the one hand, Amazon would have to trust random people who might as well just take the packages for themselves instead of delivering them to the final recipient. Another open question is whether local retailers would be willing to cooperate with their biggest e-commerce competitor. Finally, the service could not match the delivery quality and efficiency of the big parcel carriers.
Another potential obstacle concerns Amazon’s shipping volumes which amount to 3.5 million packages a day, according to SJ Consulting Group. Relying on ordinary people, Amazon wouldn’t have the guarantee to always have enough couriers to cope with the huge volumes.
The crowd-sourcing delivery concept is similar to those that several other companies are working on including Deliv Inc., Uber Technologies Inc. and Instacart Inc. In 2013, Walmart also briefly considered turning customers at its stores into package carriers. But so far, no one has been able to seriously challenge the parcel carriers on the last-mile delivery operations.
Amazon has been trying out various delivery options over the years. In several US cities, it employs bike couriers for its Prime Now one-hour delivery and has contracted delivery firms for its same-day grocery deliveries ‘Amazon Fresh’ while teaming up with USPS to provide Sunday deliveries.
