Amazon eyes new inroads in delivery

Retailer to experiment with business pickup

SAN FRANCISCO – Amazon’s planned test of its own delivery service from merchants’ warehouses to its fulfillment centers is the first step in a long-term strategy that could change how packages make the final journey to your door, possibly resulting in lower prices and faster shipping times for consumers.

The experiment is expected to launch sometime later this year in the Los Angeles area with a handful of companies that sell goods on Amazon’s site, sources familiar with the project who asked to remain anonymous because they weren’t authorized to speak publicly told USA TODAY.

The proposed service would allow third-party sellers — whose goods make up the majority of those sold on Amazon — to have an Amazon truck come to their warehouse, pick up pallets of packages and take them to an Amazon fulfillment center, where they would be inserted into Amazon’s formidable delivery system. Right now they have to ship them to Amazon centers themselves.

By using Amazon to pick up packages, the merchants could shave as much as a day off delivery times, a boon when time equals money and also customer satisfaction.

At least in its initial phase, the test would only involve deliveries between Amazon merchants and Amazon’s own fulfillment centers, not delivery to customers’ homes.

Once they left the Amazon fulfillment center, the packages would still be delivered by one of several delivery systems Amazon already has in place, including UPS, FedEx, the U.S. Postal Service and local delivery contractors.

In the longer term, the project could expand into a larger, full-service delivery system that would circumvent Amazon’s traditional last-mile shippers such as UPS and FedEx.

The Wall Street Journal first reported on Amazon’s delivery service plans.

Amazon would not comment on the reports and in a statement to USA TODAY said only that it was always innovating and experimenting on behalf of customers and the businesses that sell on Amazon to create faster, lower-cost delivery choices.

Amazon may try bringing packages from third-party merchants to its fulfillment centers.