US Postal service to deliver Amazon groceries between 3 and 7 am

An article in the Wall Street Journal (September 6,2014) titled “U.S. Mail Delivers Amazon Groceries in Test” describes a pilot in which US Mail delivers containers of grocery including meat and dairy in San Francisco. The deliveries take place between 3 and 7 am when the delivery trucks are unused. Customers are offered free delivery for orders over $100 or between $8 and $10 otherwise. Will such a scheme, that does not share space with mail deliveries, be feasible in the long run ? With over 35% of Amazon’s deliveries done by the US Postal service, will such a solution that is not pooled with other Amazon shipments, enable Amazon to solve the last mile problem ? How is this a profitable project for the US Postal Service if all costs of operation, including depreciation of the trucks, have to be borne by the revenues from Amazon ?

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About aviyer2010

Professor
This entry was posted in Capacity, Collaboration, Ecommerce, Service Operations, Supply Chain Issues, truck and tagged , . Bookmark the permalink.

2 Responses to US Postal service to deliver Amazon groceries between 3 and 7 am

  1. Yunyang Olivia Liu says:

    I think that delivering between 3 to 7 am actually have big business potential, especially for some companies who will have meetings in the morning and need materials ready at the beginning of the day. I believe many companies will pay premium for this overnight service of Amazon carrier and its is a hidden market ready to get unlocked.Amazon can use the overnight delivery as sample trial for building up its own logistics network.

  2. Zimi Surana says:

    Today last mile delivery is one of the biggest challenge being faced by the e-Commerce giants. There are two parties involved in the transaction. The US postal services and Amazon. Now what is it in for me?
    For Amazon, they bagged the solution for last mile delivery with one of the services with most deep network across geographies in the USA. But for Amazon consolidation of orders with other shipment is essential to attain economies of scale on the shipment costs.
    On the other hand, from US postal service point of view, if the cost of operation and depriciation over the truck are borne by Amazon, the deal is certainly bright. Also, usage of capacity in its idle time i.e. usage of trucks during off-peak time of the day is beneficial for increased revenue as well as capacity utilisation.
    Thus if executed proficiently and with transparency, it can be a win-win proposal for both the stakeholders involved.

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