This isn’t the perfect moment to call the Amazon office and do business, at least because its staff might probably be in a bad mood. The company is facing a massive job cut, and UPS recently declared that it is delivering fewer packages to Amazon.
Thankfully, Amazon has recently tapped FedEx to handle its large package deliveries. This is very timely because delivering packages in bulk could be taxing on the delivery personnel and the company as a whole.
Amazon tapping FedEx
FedEx is a worldwide leader in transportation, eCommerce, and logistics, mainly known for its express delivery services. However, it also offers several various shipping options, such as overnight delivery, as well as provides other services like data analytics and supply chain management.
It’s the first company to come to mind when you’re looking for those services, though they can get a little pricey. FedEx has a name, you know.
So, Amazon made the best choice by partnering with FedEx for a deal that will last several years, like a multi-year agreement, covering residential delivery of select large packages for the eCommerce giant. Yes, like a multiple-entry visa.
Experts also say this deal between Amazon and FedEx offers the eCommerce platform “cost favorability” over its previous tie-up with FedEx’s rival, UPS.
What does FedEx think about this deal? For them, it is a multi-year agreement that’s oh-so-mutually beneficial.
Note, though, that this partnership will not replace UPS and the services it provides for Amazon. FedEx will join as third-party partners, just like how it is for UPS and the USPS, working alongside its own last-mile delivery network.
Also, experts are confident this deal will mend the once-broken relations between FedEx and Amazon in the past. In 2019, you can remember that the companies cut residential delivery ties between each other, but not because of some scandalous issues. Instead, Amazon was then building its sprawling network of delivery services. Quite interesting.
So, what happens with UPS?
Interesting question. As you may well know, United Parcel Service is a multinational package delivery company in the United States, holding the reputation of one of the world’s biggest shipping couriers.
UPS provides an extensive range of shipping and logistics services, including package deliveries, global shipping, and supply chain management. Quite remarkable.
At the beginning of this year, UPS announced that it would reduce its shipment volumes for Amazon, its biggest customer, by more than 50 percent by the second half of 2026 to focus on fewer yet more profitable deliveries. Intelligent move? Definitely.
UPS also added that it is slashing 20,000 jobs and shutting down over 70 facilities, so it’s not entirely Amazon’s fault that the company backed out partially. UPS is also cutting costs and conducting efficiency projects due to restructuring.
Over the last half-decade, FedEx and UPS have been engaged in a fierce battle for market share, often poaching whole or partial customer accounts from the other.
In other words, this deal was seen coming. Amazon is having a broken relationship with UPS, so it was keen on looking for new opportunities.
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