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Amazon exclusively going to UPS?
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<blockquote data-quote="worldwide" data-source="post: 2400329" data-attributes="member: 2193"><p>If Amazon left UPS entirely, it would reduce revenue by about 1.67% so Amazon is only a small part of overall UPS revenue. UPS is well diversified. The margin on Amazon shipments is likely pretty small as well. The big losers if Amazon were to pull volume from UPS would be drivers, preloaders and local sorters with low seniority. UPS as a corporation would continue to operate just fine but with the volume reduction would come a reduction in some jobs. I've read in the past that UPS says 40 new international packages equals one new job. Not sure how many ground packages equals a new job. If it's 100 or 150 ground packages that equals a new job, losing the volume from Amazon would certainly mean a reduction in jobs at UPS.</p><p></p><p>"Stitching together a full-fledged logistics network could give Amazon a piece of a world-wide delivery market that, according to financial services firm Robert W. Baird, generates roughly $400 billion in annual revenue. It could also damage its relationships with UPS and FedEx. Amazon contributes around $1 billion to UPS’s revenue, according to people familiar with the matter. Perhaps more important, the retail giant’s heft helps both UPS and FedEx to be more cost effective by allowing drivers to drop off more packages in the same areas. If Amazon pulls too much business from the delivery giants, the carriers could respond by eliminating certain volume discounts."</p><p></p><p><a href="http://www.wsj.com/articles/amazons-newest-ambitioncompeting-directly-with-ups-and-fedex-1474994758" target="_blank">Amazon’s Newest Ambition: Competing Directly With UPS and FedEx</a></p></blockquote><p></p>
[QUOTE="worldwide, post: 2400329, member: 2193"] If Amazon left UPS entirely, it would reduce revenue by about 1.67% so Amazon is only a small part of overall UPS revenue. UPS is well diversified. The margin on Amazon shipments is likely pretty small as well. The big losers if Amazon were to pull volume from UPS would be drivers, preloaders and local sorters with low seniority. UPS as a corporation would continue to operate just fine but with the volume reduction would come a reduction in some jobs. I've read in the past that UPS says 40 new international packages equals one new job. Not sure how many ground packages equals a new job. If it's 100 or 150 ground packages that equals a new job, losing the volume from Amazon would certainly mean a reduction in jobs at UPS. "Stitching together a full-fledged logistics network could give Amazon a piece of a world-wide delivery market that, according to financial services firm Robert W. Baird, generates roughly $400 billion in annual revenue. It could also damage its relationships with UPS and FedEx. Amazon contributes around $1 billion to UPS’s revenue, according to people familiar with the matter. Perhaps more important, the retail giant’s heft helps both UPS and FedEx to be more cost effective by allowing drivers to drop off more packages in the same areas. If Amazon pulls too much business from the delivery giants, the carriers could respond by eliminating certain volume discounts." [URL="http://www.wsj.com/articles/amazons-newest-ambitioncompeting-directly-with-ups-and-fedex-1474994758"]Amazon’s Newest Ambition: Competing Directly With UPS and FedEx[/URL] [/QUOTE]
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