Supply Chain News / eSupply Chain / Finance & Credit

USPS & Amazon to Deliver Sundays

Packages on Sundays, starting in LA & NY

November 13, 2013 Inc. will begin delivering packages on Sundays in the nation's two largest cities later this month with an unlikely partner—the United States Postal Service.

“If you’re an Amazon Prime member, you can order a backpack for your child on Friday and be packing it for them Sunday night,” said Dave Clark, Amazon’s vice president of worldwide operations and customer service. “We’re excited that now every day is an Amazon delivery day and we know our Prime members, who voraciously shop on Amazon, will love the additional convenience they will experience as part of this new service.”

Sunday delivery is Amazon's latest effort to chip away at a key advantage for brick-and-mortar retailers: immediacy. Amazon and the Postal Service declined to discuss the costs, volume projections or the length of the contract.

Amazon said Sunday delivery will begin on Nov. 17 in Los Angeles and New York and expand next year to Dallas, New Orleans, Houston and Phoenix, among others. Amazon will bring packages from its warehouses to Postal Service locations on Saturday evening or Sunday morning. The agency will then deliver them to doorsteps.

Sunday delivery will be available for all Amazon customers in markets where the program is available at no additional cost. Customers won't specify Sunday delivery; eligible items will show up on Sunday if that is when they are ready.

“As online shopping continues to increase, the Postal Service is very happy to offer shippers like Amazon the option of having packages delivered on Sunday,” said Patrick R. Donahoe, Postmaster General and Chief Executive Officer. “With this new service, the Postal Service is now delivering packages seven days a week in select cities. Customers can expect the same reliable and valued service that the Postal Service currently provides.”

To participate, Amazon customers can simply add millions of eligible items to their cart and will see the Sunday delivery promise at checkout when available in their region.

Representatives of Amazon and the Postal Service said the Seattle-based company was taking advantage of a little-known offering available to any shipper. The Postal Service makes limited Sunday package deliveries for its own needs around the holidays, but the arrangement with Amazon represents its first large foray into Sunday delivery.

The Amazon contract will be a much-needed financial boost to the Postal Service, which continues to bleed red ink. The agency, which said it expects to lose around $6 billion this year, has been closing locations and has proposed ceasing Saturday delivery of many items to cut costs.

A Postal Service spokeswoman said the agency wouldn't need to hire additional workers. She said officials have been working for more than a year on a "flexible" workforce that could be asked to clock in on Sundays. "We're ready for Sunday in the current markets," the spokeswoman said. "If this were to expand, we would look at staffing levels and adjust accordingly."

Amazon selected the Postal Service over United Parcel Service Inc., FedEx Corp. and others because its technology pairs well with the government agency's, said a spokeswoman, who declined to discuss specifics. The Postal Service delivers some Amazon packages on other days.

Sunday delivery is Amazon's latest initiative to expand the speed and breadth of its offerings. The company has been building a network of warehouses close to urban centers, from which it has begun offering same-day grocery delivery in Los Angeles and Seattle using its own trucks. Amazon has offered Sunday delivery through the grocery service, where consumers can select from more than 100,000 non-grocery items to be delivered along with their frozen waffles and tomatoes — an offering that will continue after Sunday parcel delivery begins.

In addition, Amazon has created mini-distribution centers in Procter & Gamble Co. plants from which it ships items directly to customers, rather than relaying them through larger warehouses. To reduce failed deliveries, it also is installing lockers in grocery, convenience and drugstore outlets where customers can later pick up their packages.

Dave Clark, Amazon's vice president of world-wide operations, said that later this month Amazon would also begin Sunday delivery in London, using its own trucks.

Adding an additional delivery day could help drive more users to Amazon's $79-a-year Prime unlimited two-day shipping program, said Mr. Clark. Amazon doesn't disclose its Prime membership rolls, though it said this month that those customers buy twice as many goods as customers opting for free shipping. Analysts estimate the company has more than 10 million Prime users.

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