In a previous Supply Chain Matters commentary we called attention to a posting from the online site Motherboard describing referred to operation “Aerosmith” launched in September from an unknown corporation and run by Ohio-based aviation services provider Air Transport Services Group (ATSG). The report indicated that the unnamed company had leased four Boeing 767 air freight aircraft and was operating out of the Wilmington Air Park near Columbus Ohio, a former DHL air freight hub. That unnamed company has been speculated to be that of Amazon.
At an event last Friday in Chicago, Amazon employees from nearby fulfillment centers packed 2,000 care packages to send to soldiers abroad who are not able to come home for the holidays. Since 2010, Amazon has shipped more than 12 million packages to APO and FPO addresses. The Amazon care packages for the troops included holiday chocolates and snacks alongside an Amazon Fire tablets.
What was interesting was Amazon’s optics which included the care packages for soldiers headed off in an Amazon branded trailer—one of thousands that Amazon purchased and started to roll-out to increase capacity for package delivery from fulfillment centers to sort centers. Amazon’s Vice President of North America Operations Mike Roth said, “I couldn’t be more pleased that our very first Amazon trailer headed out on the road carrying such special packages—thousands of boxes filled with beloved holiday items and Amazon Fire devices to support troops abroad this holiday season.”
These unfolding developments, dedicated over-the-road trailer assets to move parcels from customer fulfillment to advanced sortation centers, dedicated air freight capabilities utilizing 767 aircraft, coupled with well-timed holiday announcements on advanced drone delivery vehicles all lead to the possibility that these combined capabilities will unveil themselves in a more end-to-end contiguous customer fulfillment and premium last-mile delivery capability for Amazon Prime members in 2016. In essence, Amazon’s unfolding strategy is to move closer to controlling the cost and reliability of ‘last-mile’ parcel delivery.
The implications for other online retailers is significant, which we will delve into when Supply Chain Matters unveils our 2016 Predictions for Industry and Global Supply Chains early next week.