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FedEx Takes Aim at Amazon

FedEx Takes Aim at Amazon

By Jack Keough

FedEx has launched FedEx Fulfillment, an e-commerce solution designed to help small- and medium-sized businesses fill orders from multiple channels including websites and online marketplaces.

The new FedEx service, which has already been running a pilot program with businesses, will handle the entire order fulfillment process. A company can send its products to FedEx, and FedEx will handle everything from warehousing the products, fulfillment, packaging, delivering and even taking return orders. The service is backed by a platform that integrates selling channels and manages inventory.

The new service mirrors and takes aim at Amazon’s own fulfillment program, called Fulfillment by Amazon (FBA).

“FedEx Fulfillment is the latest in a series of offerings designed to help our customers succeed as e-commerce continues to grow,” said Carl Asmus, senior vice president, E-Commerce, FedEx Express. “Moving goods efficiently and reliably is what we do best. By teaming up with FedEx Supply Chain and utilizing the world-renowned FedEx networks, customers can focus less on fulfillment and logistics challenges and more on growing their businesses.”

Using the FedEx Fulfillment platform, customers will have complete visibility into their products, giving them an easy way to track items, manage inventory, analyze trends, and make more informed decisions by better understanding shoppers’ spending behaviors.

FedEx Fulfillment, created by third-party logistics provider FedEx Supply Chain (formerly known as GENCO) has one of the industry’s latest same-day fulfillment cut-off times, two-day ground shipping to the majority of the U.S. population, and the capabilities for a hassle-free returns process.

“FedEx Fulfillment gives small and medium-sized businesses the potential to achieve profitable and scalable growth,” said Ryan Kelly, senior vice president, FedEx Supply Chain. “Online shoppers show deep-rooted loyalty to brands with fast shipments, easy returns, positive customer service experiences and flexible delivery options.”

FedEx Supply Chain provides businesses with a comprehensive suite of integrated logistics solutions, including warehousing, distribution, transportation, e-commerce fulfillment and reverse logistics.

Participating businesses will store their products at FedEx warehouses in the United States and Canada. FedEx will package and ship the products to customers and will offer custom boxes with a brand’s logo rather than with FedEx’s own logo.

FedEx’s Fulfillment program has one advantage over Amazon in that sellers will not be giving their sales data to FedEx, as Amazon customers are required to do. Amazon’s program, however, has the advantage of Prime-eligible program, which gives access to Amazon’s many vendors and customers.

Amazon recently said in its latest earnings statement that FBA delivered more than two billion units on behalf of sellers in 2016 and makes up a substantial amount of revenue. Some analysts say Fulfillment by Amazon represents more than half of the Seattle-based company’s revenues.

For the past 16 years, Amazon has allowed third-party sellers to list their goods in Amazon Marketplace and store those goods in Amazon warehouses. Amazon then ships the products when they’re purchased.

The company has indicated, as it builds massive fulfillment centers around the country, that it is looking for one-day delivery for many products, which could mean it is attempting to replace its shipping partners such as Fed/Ex.

Keough was the editor of Industrial Distribution magazine for more than 26 years. He often speaks at industry events and seminars. He can be reached at john.keough@comcast.net or keoughbiz@gmail.com.


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