Amazon is expanding its own shipping service that directly competes with FedEx and UPS, email invite shows

• Amazon is inviting sellers to use its own in-house shipping service, called Amazon Shipping.
• Amazon Shipping is expanding to handle shipments within the contiguous United States.
• It ships packages for products sold on Amazon, but also the seller’s own website or other marketplaces.

Amazon’s own shipping service, which competes with FedEx and UPS, is rapidly expanding.

According to an email invitation obtained by Insider, Amazon invited some sellers to use Amazon Shipping, its own in-house delivery service, earlier this week. According to the invite and its official website, the service delivers products sold on Amazon’s own marketplace and other sites, including the seller’s own or other channels.

“Introducing reliable and fast delivery for Amazon selling partners,” according to the invitation. “Available for multiple channels — your website, Amazon.com, and more.”

According to the website of Amazon Shipping, the service handles shipments “within the contiguous United States,” but not international delivery from the United States. It has also been released in other countries, including the United Kingdom, France, Italy, Spain, and India. According to the email invitation, Amazon Shipping is available seven days a week, with weekend deliveries free of charge.

Amazon Shipping first launched a beta service in select cities such as Los Angeles and London in 2018. However, as previously reported by Insider, Amazon suspended it in 2020 due to a pandemic-related supply chain lockdown.

Amazon Shipping is the e-commerce giant’s latest foray into last-mile delivery, which was previously dominated by UPS, FedEx, and the United States Postal Service. According to data from e-commerce logistics layer Pitney Bowes, Amazon’s share of parcel volume in the US stood at 23% in 2022. This places it third, trailing only the US Postal Service and UPS, which accounted for 32% and 24%, respectively. FedEx controlled 19% of the market.

Olivia Connors, an Amazon spokesperson, told Insider that Amazon Shipping is “another option for shipping packages to customers quickly and cost-effectively.”

“We’ve been providing this service for a while now with positive feedback, so we’re now making it available to more selling partners,” the company said in a statement.

Freight Waves previously reported on some aspects of Amazon Shipping’s growth.

According to one Amazon seller who was invited to use Amazon Shipping, the new service is a significant improvement over what was previously available. Because they were not authorized to speak to the press, this seller spoke on the condition of anonymity.

Until now, according to this seller, Amazon did not allow merchants to directly book Amazon’s own shipping service. If the merchant used Amazon’s fulfillment service, Amazon would decide whether their packages would be delivered by UPS or Amazon’s own shipping service.

Sellers can now use Amazon Shipping directly, even if they ship from their own warehouse, thanks to Amazon Shipping. According to this merchant, it also handles products sold through other channels such as eBay or the seller’s own website. They only need to book the shipment through their Amazon seller account and Amazon’s back-end system.

According to this merchant, who specializes in beauty products such as facial cream, Amazon’s pricing isn’t as competitive for small items right now. However, as it grows, the seller believes it will become more price competitive. Longer term, Amazon could expand beyond its own sellers and turn this into a standalone service that competes directly with UPS or FedEx, according to this source.

The expansion comes after Amazon imposed new fees on sellers who do not use Amazon’s own fulfillment service. According to Bloomberg, Amazon has informed sellers who use their own warehouses but still want to be eligible for Prime placement that they must pay an additional 2% fee.