Is that 3 cents after the money FedEx makes that goes into paying for the courier, the truck, the fuel? FedEx isn't paid 3 cents per pkg, it clears 3 cents after it's other expenses. And nationwide that profit adds up. If it didn't work for the company's accountants they wouldn't be doing it. Now if that isn't worth it to Ground contractors to clear 3 cents a pkg ok, point taken. But even Amazon knows it can't push for 2 cents because no one will deliver their pkgs if they can't make money doing it. Which is why they're looking to deliver their own pkgs as much as possible.
Amazon
- Thread starter vantexan
- Start date
X is cheap. If it can't make X% profit, they'll walk away. They've turned away Bezos several times. No need to suck up to him now.
UPS, however may be in a bind. They sold out for that volume.
That's a fact Jack. Why would you want to commit your remaining capacity to hauling Bezo boxes when you know that if you wait a couple of years you stand a good chance filling it up with higher margin boxes.?
SmithBarney
Well-Known Member
You have to remember, FDX/UPS and common carriers are only "profiting" on the shipping...
Amazon is Profiting on what's in the box, and if they can cut out shippers in certain markets, they will profit on the shipping and even if it's only a penny, that is all they need.
SmithBarney
Well-Known Member
FedEx isn't one for "waiting" around... hence the latest push for the past two years for all sales leads, big and small.
It will be fine
Well-Known Member
If anyone can bring the price of prescription drugs down I welcome them to the market. Amazon is usually good at cost reduction, I hope they succeed.
UpstateNYUPSer(Ret)
Well-Known Member
Rx drug prices are much lower in Canada.
Ridiculously low here if one has a good prescription plan.
Gone fishin
Well-Known Member
Bezo also has a plan for the recipient to leave the house door open or car so the courier can leave the package to avoid theft.
Haha ya right
Haha ya right
Everyone is missing a major part of this puzzle... It isn't always about profit. Sometimes just covering cost is worth obtaining large accounts like Amazon. Large accounts allow the business to scale differently and therefore lower their per package overhead. Example: Terminal handles 1000 packages a day and they are all done by hand. Terminal handles 25000 packages a day and uses automation. Which terminal spends more money per package to process? By scaling up, it increases the profit margin on their other accounts. That is what Amazon offers. This is all before considering the increase in value that comes from the added market share and gross income. Publicly traded companies are different animals.
And if Amazon is serious and decides to expand their delivery network to challenge UPS and FedEx for customers? Then where do things stand?
Star B
White Lightening
I don't know of any Express stations that have automated sorts other than the hubs.
Purplepackage
Well-Known Member
And you won't, they are to busy making you lock up keys to even fix leaks in the roof
SmithBarney
Well-Known Member
There are a few larger facilities that have automated sort, but I don't think they qualify as hubs, have about 4-5stations under one roof, and service a large area with CTV/RTVs as well.
You mean ramp operations right? Don't know of any place that has multiple stations working out of same facility for courier delivery.
SmithBarney
Well-Known Member
There are.
That would be a huge building then!
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