The race to get/stay ahead in the retail game is heating up and it is largely thanks to the behemoth that Amazon has become. And much of what Amazon has done to be such a formidable competitor is probably the fact that it is responsible for transforming the way people shop: not just in terms of where (brick-and-mortar vs online) but how often.
And a big part of transitioning retailers to the online marketplace has been speedy and accurate delivery. Amazon, of course, must depend on delivery methods to ensure that users get what they ordered. The addition of Amazon lockers has helped, but so has the guaranteed delivery in just a matter of days.
Indeed the two-day delivery window that has long been guaranteed for Amazon Prime users has been a major obstacle for traditional retail outlets, many of whom started to offer same-day pickup for online orders. But it looks like Amazon is ready to take on that monster as well with new default one-day delivery for all 102 million global Prime members.
Now, if this not that exciting for you it might be simply because you already live in a zip code that has had consistent access to the one-day option; or you have simply enjoyed the two-day standard without really thinking about it. But this new one-day delivery strategy is set to change the game yet again as major retailers like Walmart and Target again find themselves behind the proverbial eight-ball in direct competition with the seemingly unstoppable retail stalwart that is Amazon.
Of course, while Amazon has announced this possibility, they now have the immensely difficult and complicated task of operating it. The implications are quite profound, indeed, as it affects pretty much every single company that deals with Amazon. And Amazon, at its core, will have to bear the cost of upscaling and restructuring. Amazon CFO has actually reported that the revamp should be an investment worth roughly $800 million, in the second quarter alone. And they will probably spend quite a bit more.
From a logistics standpoint, regularly satisfying the number of one-day deliveries Amazon could have with this program could require at least twice the size of the Amazon’s air fleet, which is manned by two partners: Atlas Air Worldwide Holdings and Air Transport Services Group. Also, Amazon will also likely have to increase delivery stations—to nearly 400—in markets with populations greater than 100,000.