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Amazon Wants You To Start a Business To Deliver Its Packages (cnn.com)

Posted by msmash on from the business-proposition dept.

If you have $10,000 and want to be your own boss, Amazon has a deal for you. From a report: Starting Thursday, you can apply to start your very own small business, delivering Amazon Prime packages in Amazon branded vans and uniforms. The company wants to help launch small businesses in the United States dedicated to taking its packages on the last step of their journey: from local Amazon sorting centers to the customers who ordered them. It announced the new program on Wednesday at a press event in Seattle.

It's the latest attempt by Amazon to gain greater control of the delivery network at the core of its Prime business, which ships 5 billion packages a year globally. [...] Amazon's new "Delivery Service Partners" and their staff members won't be employed by the tech company. The initial $10,000 costs will go to helping them start an independent business that has to begin with at least five delivery vans and ramp up to 20 vans over an undisclosed period of time.

12 of 222 comments (clear)

  1. Amazon wants you to go broke by Anonymous Coward · · Score: 5, Insightful

    Amazon wants you to take all the risk to get into a race to the bottom with other hopefuls in a competition to see who can deliver packages for Amazon for the least possible cost.

    Make no mistake about it, Amazon will dole packages out to the lowest bidder, and the only ones who will make money are those who consider their time to be worthless, thus becoming ex-parte slaves like Uber drivers already are.

    1. Re:Amazon wants you to go broke by hackertourist · · Score: 5, Insightful

      Exactly. And $10k is just the start. You'll also be leasing 5 Amazon-branded vans. Your Amazon contract will say you can't use those vans to deliver packages for anyone else, so Amazon becomes your only customer, and you're fucked if Amazon takes their business to your competition. 5 vans also means you can't start slowly just with 1 van and yourself as the driver, you'll need to get into personnel management, planning etc. All the joys of company ownership.

    2. Re:Amazon wants you to go broke by jellomizer · · Score: 2, Insightful

      This is a franchise. Just like many other places you go to.

      If it is profitable for the franchisee then they will go with it, otherwise they will not.

      Uber, was intended to be a part-time job. This is a franchise, it is your own company, you have more options available to you, but being a franchise there are standard you need to meet. Just like a fast food franchise cannot sell their food at a different price, the Amazon Delivery Company cannot charge Amazon too much for shipping.

      What amazon really is doing is mitigating its risk.

      --
      If something is so important that you feel the need to post it on the internet... It probably isn't that important.
    3. Re:Amazon wants you to go broke by aaarrrgggh · · Score: 5, Insightful

      No, they want to eliminate the "contractor" risk for themselves and pass it on to you! If you are forced to have a minimum of 5 trucks, you directly can't be an employee of Amazon... and your employees are (in theory) unable to sue Amazon for class status. By keeping it small, it also protects Amazon from saying labor abuses are widespread...

      Saying all that... I have no idea how anyone could possibly break even at that business when paid less than $3/package for delivery. Even at $5/package would seem like a challenge to make money and cover all overhead costs. (The drivers themselves were already fsck'd.)

  2. Translation : Amazon doesn't want to pay delivery by Bradmont · · Score: 5, Insightful

    This really just comes off as an effort to avoid dealing with employment standards for delivery people...

  3. That's...not really your own business. by Pezbian · · Score: 5, Insightful

    If you answer to a corporation and not your customers, it's a franchise.

    It's basically Amazon Avon.

    --
    In a world of the blind, the one-eyed man is king--and the two-eyed man is a heretic.
  4. Don't let companies do this by Pinky's+Brain · · Score: 5, Insightful

    If you're driving around with their branding and they set your hours, they're your boss. The pretence that the drivers are independent contractors is just an end run around labour regulations.

  5. Re:So.... by Pinky's+Brain · · Score: 4, Insightful

    Amazon is putting a small twist on it, by making it a minimum 5 man company instead of dealing with 1 man companies.

    It's a smart scheme, but I hope the judges remain unamused.

  6. Terrible business idea by Solandri · · Score: 5, Insightful
    From TFA:

    The business owners will be able to make as much as $300,000 a year in profit running a full-sized fleet of 40 vans and managing 100 employees, according to Amazon.

    That works out to a profit margin (net income) of just $3000/yr per employee.

    Most businesses have a net income per employee of tens of thousands of dollars ($28k/yr average for the fortune 500), with the best ones pulling in well over $100,000/yr per employee. Most of the companies with a net income per employee below $10,000/yr are huge corporations who gain economic stability from having 100,000+ employees (erratic performance by a single employee does not affect their bottom line much), and are able to leverage economies of scale to turn those meager profit margins into something worth doing.

    If you take up Amazon's offer, you're basically dead meat. Especially since you're in the precarious position of only having a single customer, and have no leverage to negotiate prices - you either accept what Amazon says they'll pay you or they'll bankrupt you overnight. This is basically Amazon outsourcing the delivery business, where they take the lion's share of the profit for themselves, while offloading all the risk (fewer deliveries due to an economic downturn) onto the poor schmucks who took out loans to buy all those delivery vans and have to pay payroll and unemployment regardless of how poorly business goes.

  7. Re:So.... by stephanruby · · Score: 2, Insightful

    That's why Amazon wants you to buy 5 vans (at the minimum) and 5 sets of uniforms instead of just 1 van and 1 set of uniform. In other words, your delivery people don't need to be independent, they can be YOUR employees.

    So if someone gets sued, you get sued, not Amazon. Or if someone goes belly up, you go belly up, not Amazon. In other word, they found a loophole around the FedEx dilemna.

  8. Re:Sure, but... by NicknameUnavailable · · Score: 5, Insightful

    Of course it's not going to be actual profit - if Bezos could turn a 30-fold profit on this he'd be launching the delivery company himself.

  9. Pitting the labor force against itself..... by acvh · · Score: 4, Insightful

    So instead of relying on existing methods of delivery, UPS, USPS, FedEx, they want to get individuals involved. What that really means is that reasonably well paying jobs with delivery companies decrease in number, while poor schmucks in debt to Amazon increase.

    This is happening throughout the US labor landscape. It's one of the reasons labor unions came into existence way back when. Unfortunately "union" is now treated as an expletive, and the very people that unions can help most are the ones who object to them most strongly.

    But don't forget that UPS drivers are Teamsters, and won't take kindly to a bunch of amateurs taking a bite out of their livelihoods.