Amazon (AMZN) has launched a local delivery partner program for new entrepreneurs and small business owners, in a move to make its presence visible in an industry dominated by FedEx (FDX), United Parcel Service (UPS), Deutsche Post’s subsidiary DHL, and the United States Postal Service.
In addition, Amazon is also planning to reduce shipping costs that have risen almost 38% during the first-quarter. During this period, the company had reported online sales growth of 18% and growth in sales from third-party seller services of 44%.
The e-commerce giant will help clients set up their own delivery business, including vehicle leasing, technology, insurance, and training. This is in addition to the Amazon Flex program, whereby drivers use their own cars for delivery.
This program will create thousands of driver jobs across the US. Amazon said by operating a fleet of 40 vehicles, a successful small business owner has the possibility to earn as much as $300,000 in annual profit under the new program.
The company said the business can be started with as little as $10,000 investment. Military veterans, who are starting the business, will get the full reimbursements as Amazon is committing $1 million towards funding startup costs.
Last week, Amazon rolled out a last-step delivery option called Hubs, whereby lockers are provided to apartments to collect Amazon products. This is Amazon’s strategy to establish itself better in the logistics network. Last year, with 7,000 trucks and 40 airplanes, as well as with external delivery partners, Amazon shipped over 5 billion Prime items. Amazon is playing safe by relying on itself rather than outside partners for delivery of items.