In an effort to take greater ownership of the supply chain to better manage costs, reduce prices and fluctuations in prices, Amazon is moving to vertically integrate supply chain services into its business.
One of these areas is the so called middle mile - where goods are brought from distribution centres to fulfillment centres. While the middle mile has traditionally been outsourced, it has recently received more attention as squeezed supply chains have made headlines for costing retailers millions of dollars in profit.
Now in the USA Amazon offers 2 new services:
Amazon Freight - allowing retailers to book space on its freight trucks for 1000s of routes across the USA. Amazon uses algorithms to determine which vehicles are operating less than load to offer discounted shipping rates to retailers
Amazon Air - operating planes for deliveries. Currently only for Amazon retail, but expect to see Amazon create additional revenue streams from this similar to Amazon Freight.
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