Amazon has long dominated online retail. Pretty much everything from books to canned food can be ordered through Amazon. The trick was always delivery. You can get basically the same items from your local retail store during regular business hours just by driving to the store. Ordering online takes a few days for items to be handled, shipped and then delivered. Amazon has been working hard to eliminate that delay.
First, Amazon became famous for its standard free two-day delivery. This standard forced many other online retailers to not only drop delivery fees, but also try to catch up with the two-day promise. Amazon built distribution centers across the U.S. like crazy to ensure packages could be shipped from nearby locations. More recently Amazon introduced the concept of "same-day" delivery. You order an item one day ... and later that same day you get it delivered to you. Currently this option is limited to select locations and select items, but we should expect this to become standard sooner than later.
So how, exactly, is Amazon going to do what no online retailer has ever done? And for that matter, what no company that specializes in delivery currently offers? Well, Amazon is going to create its own logistics and delivery network.
In 2015 Amazon invested in its first cargo airliner. It was actually a rented Boeing 767. After a short trial run of only a few months, Amazon invested heavily into the air cargo business. Today Amazon Air, as it is called, has 46 aircraft with more on order. Most are operated by Air Transport International (which Amazon owns a significant stake in) but are all painted "Amazon Air." The main base of operations is at Cincinnati/Northern Kentucky International Airport and they fly to several dozen other destinations. A quick look at Amazon’s job board for the air service shows they intend to keep growing this operation aggressively.
While 767s are great at hauling a large number of packages between two cities, they cannot exactly deliver the individual packages to you door. To solve this problem, Amazon has started to build a network of local delivery teams. If you have ordered anything from Amazon recently, you probably have noticed some of the packages are not delivered by the normal delivery guy. You may have even seen a dark gray Amazon van. Those are independently owned delivery vans that provide service only for Amazon. Amazon actually offered employees $10,000 to quit to start their own local Amazon delivery service. Additionally, Amazon has decided to purchase its own fleet of electric delivery vans in an effort to cut costs even farther. That is why Amazon placed an order for 100,000 electric vans from Rivian (and yes, that is correct, one hundred thousand vans). Rivian happens to be another company Amazon has invested heavily in.
One hundred thousand electric vans are pretty cool, for delivery, but the roads are still cumbersome. You have to have a human being drive the vehicle on predefined roads and observe traffic laws such as stop signs and speed limits. Traffic can also be problematic when you are trying to deliver hundreds of packages in a single day. So Amazon also has invested in drone technology to deliver packages. How futuristic is this? The first package to be delivered by drone was Dec. 7, 2016. Again, not a typo. It happened three years ago. This service is still in its infancy, mainly because this service has been limited to outside the U.S. due to FAA restrictions. Progress on regulations has been made and regular U.S. deliveries could be expected soon. This won't just be same-day delivery, this will be 30-minute delivery.
Amazon has been changing the way we shop for quite a number of years. Not just a large selection of affordable items, but how they are produced and delivered. We should expect more big things from Amazon in the near future.
— Brian Boyer is the managing partner of Web Pyro (http://?www.webpyro.com) located in Wooster.