Amazon opens logistics network to other businesses, challenging UPS and FedEx
Amazon has opened its logistics network to all businesses, offering a range of services including freight, distribution, fulfillment, and parcel shipping. This move has caused UPS and FedEx shares to drop. Early adopters of Amazon's new service include major brands like Procter & Gamble, 3M, Lands' End, and American Eagle Outfitters.
Amazon launched Amazon Supply Chain Services (ASCS), opening its vast logistics network to any business regardless of whether they sell on Amazon's marketplace . The move sent immediate shockwaves through the freight industry: UPS shares dropped nearly 10% and FDX fell more than 9% on the announcement, with analysts flagging the credible threat Amazon's scale poses to legacy freight incumbents .
ASCS bundles freight, distribution, fulfillment, and parcel shipping into a single offering. Amazon's first adopters include Procter & Gamble using the freight network for raw materials, 3M moving products to distribution centers, and Lands' End fulfilling multichannel orders from Amazon warehouses. The service is backed by Amazon's infrastructure of 200+ U.S. fulfillment centers, 80,000+ trailers, 24,000 intermodal containers, and a fleet of 100 cargo aircraft that delivers 13 billion items annually.
Amazon is positioning ASCS as the logistics equivalent of AWS — a capability built for internal use and now monetized as an external service. The B2B shipping segment targeted by ASCS is especially lucrative for logistics firms: deliveries are denser, more predictable, and less expensive to serve than consumer shipments, meaning Amazon can undercut UPS and FDX on price while still generating high margins from its already-sunk infrastructure investment.
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