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Amazon Looking To Abandon UPS, FedEx In Favor of Its Own Delivery Service (arstechnica.com)
An anonymous reader quotes a report from Ars Technica: A report by The Wall Street Journal claims that Amazon is building its own shipping service to replace FedEx and UPS, giving it more control over its packages and possibly allowing it to ship packages from other retailers. Amazon has said its own delivery services would be meant to increase its capacity during busier times of the year, like the upcoming holiday season. However, "current and former Amazon managers and business partners" claim that the company's plans are bigger than that. The initiative dubbed "Consume the City" will eventually let Amazon "haul and deliver" its own packages and those of other retailers and consumers. That delivery network would also directly compete with the likes of UPS and FedEx. It makes sense that Amazon would want to sell, ship, and deliver orders on its own. The report estimates that the company spent $11.5 billion on shipping just last year, amounting to 10.8 percent of sales. The shipping process is currently a bit convoluted: packages from Amazon warehouses get sent to one of two shipping routes, either FedEx or UPS, or to a sorting facility that lumps all packages with similar zip codes together. FedEx and UPS handle its shipments and deliver them to customers, while the packages at the sorting facilities either get delivered via USPS or by Amazon employees themselves. If Amazon were to have control over its shipments over longer distances, it's estimated that the company could save about $3 per package -- about $1.1 billion annually.
Hard to understand how we have not applied historical norms of Monopoly to Amazon
Because there are thousands of mail-order/online-shopping businesses in the country? Amazon isn't anything like a monopoly.
Don't disappoint your bird dog. Go to the range.
Remember that the only reason the USPS loses money on paper is due to having to pre-fund pensions for employees literally not born yet within 10 years.
Their unprofitability is 100% manufactured by Congress.
That's not _quite_ what the obligation is.
The obligation is that the USPS must set aside _all_ the money that it anticipates to have to pay for healthcare and pensions for _each_ of its current employees (and -obviously- every new employee that it hires) from now until that employee retires, as soon as they hire the employee. They must also set aside all money required to meet their healthcare and pension obligations for all of their retired employees.
To make that a little clearer:
If the USPS hires an 18-year old employee, they must:
* Set aside at _least_ 39 years worth of expected healthcare payments
* Set aside ~21 years of pension payments
I'm unaware of any other organization that is required by law to run in this manner. I'm also unaware of any other organization that _actually_ operates in this manner.
What these requirements _do_ do is let politicians "truthfully" say that the USPS hasn't made a profit in quite some time and _imply_ that the USPS is "just another example of government waste and mismanagement". :(
The USPS is only losing money now because legislators want it to die, so they can wipe out one of the great socialized success stories. There was a time, for a LONG time, where the USPS was profitable and self-sustaining -- at least while I was working there a little over 10 years ago.
First class postage is still under $1 for a letter picked up and delivered door to door, usually in a few days. It's a huge bargain if you ask me.
Of course it is. And it's a huge bargain because the USPS is operating at enormous losses, losing ~$8B per year.
It is worth mentioning that ~$5.5B of that is congressional mandated debt in the form of pension pre-payments for a pension fund that is already 100% funded. The other thing to note is USPS has very little control over their own pricing. They need congressional approval to set pricing and get mandates from congress but no actual funding from congress.
They do get some perks like tax exceptions on property like other government agencies, but I'm not sure if that out weighs the limits of being overseen by a congressional committee.
USPS is by far the best to ship stuff, faster, cheaper, they'll pick stuff up and hand you your mail if you're home at the time since they walked to your front door for the pickup (at least here they goto that effort). Or print your shipping, and go drop it off at one of a bazillion post offices.
The USPS is not losing money as a result of its own operational costs vs income.
All the money the USPS is "losing" is being paid into a fund to pay retiree benefits for employees 75 years into the future - YES, that would include costs for employees that have not even been BORN YET.
http://www.deliveringforameric...
And note that by law, the USPS can NEVER make a profit. "Breaking even" is the absolute BEST it is ever allowed to do.
Yes it is.
"the Postal Service would have lost $10.8 billion without the prefunding requirement."
- http://townhall.com/columnists...
And the USPS get lots of benefits:
"pays nothing in property tax, nothing in licensing or sales taxes for its vehicles and no state or federal taxes, even on its competitive products. It does pay federal tax on income from those products, but it pays those taxes to itself."
- http://www.breitbart.com/big-g...
Completely false.:
"the law only requires pre-funding of obligations to actual current and past employees."
- http://www.cnbc.com/id/4501843...
You're welcome.
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