Bloomberg Report Details Amazon’s Secret Plan to Disrupt Shipping Giants FedEx, UPS and Others
Global retailers are bracing for impact following a Bloomberg Business report detailing a multiyear plan to have mega mogul Amazon compete with shipping giants FedEx, UPS and Alibaba. The super-secret project, nicknamed Dragon Boat, is already underway and is projected to devastate long-established fulfillment giants globally.
What is “Dragon Boat”?
In a 2013 Amazon Senior Management report, the company proposed an impressive expansion to its “Fulfillment By Amazon” service, which arranges storage and packing resources for small – and large – sellers on Amazon.com. From a retailer’s perspective, Dragon Boat is a win-win. Merchants can sell their products without the hassle of the production line, freeing up time and resources to sell more product. From a customer’s perspective, it’s also a no-brainer. Items marked Fulfillment By Amazon often ship via Amazon’s popular Prime service, which means they arrive at almost – the speed of lightning.
Dragon Boat: The China – India Connection
Supply and demand – that’s the name of the game. Amazon appears to have a strong grip on establishing new methods to meet their company’s chain of demand. The new Dragon Boat unit of fulfilling orders will utilize the global economy to satisfy customers around the world. For instance, the report mentions the flow of goods originating from factories in China and India, then being pushed to customer doorsteps in cities like Atlanta, New York and London. It is strange then that Amazon will lean on China to help facilitate the ambitious Dragon Boat endeavor, meanwhile, stepping over Chinese counterpart Alibaba Group Holding Ltd – a company that is expected to reach $1 trillion by 2020. Alibaba is likewise expected to serve more than 900 million shoppers.
New Platform Will Be Branded “Global Supply Chain by Amazon”
Dragon Boat will eventually morph into a monetized brand referenced currently as “Global Supply Chain by Amazon.” In an attempt to bypass the cargo and paperwork middlemen, Amazon is aiming to amass inventory from thousands of merchants around the world and purchase space on trucks, planes and ships at reduced rates. The cargo space will be available to book online or via tablets, phones and other electronic devices, making the move efficient, clean and cheap. Dragon Boat will revolutionize the supply chain as we know it today.
What does all of this mean for shipping giants FedEx, UPS and others? Even though the Seattle-based company is revving up for a full-scale delivery shakeup with the adoption of Dragon Boat and other initiatives, it might all be in vain. At least, that’s what the financial research team at Cowen & Co. believes.
Amazon Changes the Landscape of Delivery on a Global Scale
For their part, Amazon says they are not attempting to replace UPS, FedEx or Alibaba by adopting Dragon Boat. In fact, they say they are hoping to ensure a more timely delivery during peak mailing periods – like the holidays. That could explain an interest in purchasing 20 Boeing 767 airliners and purchasing the French company Colis Prive’…or it could mean something else entirely.
Regardless of what happens next in the product pipeline, Amazon is certainly out to change the landscape of delivery services on a global scale when it implements Dragon Boat. The true test will come from consumers and the likelihood of adjusting to yet another new service. Will they switch to a newer, potentially more user-friendly interface like Amazon? Or will they stay with the tried and true services like UPS and FedEx? Techies and consumers everywhere are waiting to find out.