FedEx Corporation (NYSE: FDX) has now launched a program, FedEx Fulfillment, that will put it in direct competition with Amazon.com, Inc. (NASDAQ: AMZN). But Amazon had it coming.
FedEx Fulfillment is a logistic network that will put the company in the e-Commerce business. Small to medium-sized businesses will be able to store their products in FedEx warehouses, which are spread in Canada and USA. FedEx will then package and ship the products to customers when they are bought. The logistics company will package the products in custom packaging with the brand’s logo, rather than use the FedEx logo.
Fulfillment by Amazon has its flaws
Amazon has a similar fulfillment program, dubbed Fulfillment by Amazon (FBA). For so long, Amazon has allowed businesses to list their products in its Marketplace and even store the goods in its warehouses. Through Amazon-Prime, client’s products are exposed to Amazon’s big spenders. Amazon is quite popular, so, listing products on its marketplace translates to more exposure.
But selling at Amazon is a potential deal with the devil. Amazon can view sales numbers. The company gets to know which products are selling well and starts selling the products. Amazon competes with the sellers.
FedEx Fulfillment may be a better option
FedEx Fulfillment will be a god option for online businesses that have already established a good customer following- businesses that do not have to rely on a marketplace for customers. FedEx is not a retailer; it will not compete with sellers. The primary purpose of the fulfillment program is to focus on the retailer by doing what is right for them so that they can grow, reports CNNTech.
FedEx has made a lot of progress in their new project. Tweaking of its 130 warehouses to accommodate customer’s products has begun. Also, FedEx reports that it is receiving great customer feedback on the FedEx Fulfillment service.
Amazon had it coming
Amazon and FedEx are battling in the e-Commerce scene. The former is well established and has relied on the latter for shipping for quite a long time. But in the recent past, Amazon has been developing a logistics network. Amazon now has an air cargo hub in Kentucky. Also, recent reports have indicated that the company is working on a drone delivery project.
FedEx Fulfillment program is timely.