FedEx won't renew Amazon ground-delivery contract

FedEx won't renew Amazon ground-delivery contract

Hence, delivery giant FedEx has now chose to end its ground delivery business with Amazon and instead go for contracts with more companies, which sell their products online.

Cowen analyst Helane Becker said FedEx's profit margin on Amazon shipments is probably in the "very low single digits", and she believes the company can replace those packages with more profitable business from other retailers. But while FedEx is done with Amazon, UPS, the largest USA courier, is keeping it tight with the online retail overlord.

FedEx's goal moving forward is to source more e-commerce deliveries from other companies.

Amazon said in a statement on Wednesday that 'FedEx has been an incredible partner over the years and we value all of its work delivering packages to our customers'.

The announcement comes two months after FedEx said it had chose to allow its express delivery contract with Amazon to also expire, stating that the decision to do so was strategic in order to concentrate "on serving the broader e-commerce market". The Seattle-based company has leased jets, built package-sorting hubs at airports and launched a program to let its contractor drivers start their own businesses delivering packages in vans stamped with the Amazon logo.

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Walmart and Target will have plenty of packages for FedEx to deliver.

However, eight months on, and it seems that Amazon has indeed become a competitor.

The courier company has been working to increase its delivery network through e-commerce and the company said it is "extraordinarily" well-positioned to shift its focus. This has finally culminated in FedEx terminating its partnership with Amazon, according to a report by Reuters, after months of speculation of will-they/won't-they. UPS reeled in some $71.861 billion in revenue for the financial reporting year ending December 31, 2018, its most recent annual revenue count as of the time of publication of this article. "The shipping companies later made adjustments to improve operations, including implementing new restrictions for large retailers such as Amazon", Jonnelle Marte writes for The Washington Post.

As long as they keep their humor.

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