"Starting Thursday, you can apply to start your very own small business, delivering Amazon Prime packages in Amazon (AMZN) branded vans and uniforms.
"The company wants to help launch small businesses in the United States dedicated to taking its packages on the last step of their journey: from local Amazon sorting centers to the customers who ordered them.
"It announced the new program on Wednesday at a press event in Seattle.
"It's the latest attempt by Amazon to gain greater control of the delivery network at the core of its Prime business, which ships 5 billion packages a year globally.
"The announcement follows public criticism of Amazon by President Donald Trump over the company's arrangement with the US Postal Service. Amazon uses the USPS for an estimated 40% of its last-mile deliveries, paying bulk pricing. Trump has said he thinks it is a bad deal for the government.
"Amazon's new "Delivery Service Partners" and their staff members won't be employed by the tech company. The initial $10,000 costs will go to helping them start an independent business that has to begin with at least five delivery vans and ramp up to 20 vans over an undisclosed period of time.
"Amazon has negotiated discounts for approved entrepreneurs, including lower rates on insurance, fuel and leases for Amazon branded vans that have been customized inside for package delivery. It's also setting aside $1 million to specifically recruit and help military veterans become partners.
The partner companies can only deliver Amazon packages from the branded vans, but they're allowed to add their own non-Prime vehicles and pick up work for other companies.
"...Clark said that the new program will supplement Amazon's existing shipping setups, and that all its usual relationships with partners, including the USPS, will remain intact.
""This is a huge market segment, [with] the size of the transportation space and the growth in the parcel industry. I think there's more than enough for everybody," he said.
"Amazon plans to bring on board hundreds of these new small businesses over the next year, according to Clark.
"This program signals that Amazon would like to ramp up its last-mile logistics operation more quickly," said Colin Sebastian, an analyst at Baird.
"While they're probably safe in the short term, other delivery companies could be affected in the longer term as Amazon builds out its own comprehensive logistics operation, according to Sebastian.
"Using workers who are closely connected to Amazon and can represent it but who are not actual Amazon employees hits a sweet spot for the company.
"By not relying entirely on partners like FedEx and USPS, Amazon gets more control over the customer experience, better customer service and greater capacity to make more next-day and same-day deliveries, Sebastian said.
"At the same time, it's able to avoid the less desirable parts of owning and running its own delivery fleets, like the burden of acquiring and operating vehicles and managing employees."
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