First drones, now ocean freighters. Amazon's expanding logistics strategy moves forward.
January 18, 2016
Amazon is reportedly looking to establish its own ocean freight shipping service and extend its logistics strategy to reduce overhead and possibly offer such transport as a provider.
According to Reuters, the leading online ecommerce vendor has registered with the U.S. Federal Maritime Commission as an ocean freight forwarder. This, stated Reuters, could be Amazon's stake in the $350 billion annual ocean shipping segment. It's not likely it will buy freighters but subcontract such delivery transport service.
The move could help Amazon trim operating expenses and also sell product at lower prices, according to industry watchers.
"It has more and more control over the supply chain of their business and it gives them the ability to squeeze (costs) even further," said Satish Jindel, a logistics consultant and president of SJ Consulting Group, told Reuters.
In a blog post, Flexport CEO Ryan Peterson wrote, "Amazon's ocean freight services will be far more attractive to Chinese sellers than to American buyers. Chinese suppliers would love direct access to Amazon's vast American customer base." According to Tech Crunch, Flexport broke the story regarding Amazon’s move.
According to Peterson, Amazon will be able to reserve cargo space on ocean freighters and use it or sell the space to other businesses.
