From Yahoo Finance, Greg Bensinger discusses Amazon’s initiative to engage with independent contractors to deliver packages. Greg writes:
Amazon.com Inc. is joining the “gig” economy.
The Seattle online retailer in recent weeks has quietly rolled out a program in its hometown to ferry merchandise to customers’ homes using a network of independent contractors, similar to so-called on-demand services such as Uber Technologies Inc. and Postmates Inc.
Under the new service, called Amazon Flex, people sign up for shifts through an app that prompts them to fetch packages from mini-warehouses and take them to customers’ homes in as little as one hour. Amazon pays the drivers about $20 an hour to make the deliveries.
The Wall Street Journal in June reported Amazon was considering a similar service known internally as “On My Way.”
“There is a tremendous population of people who want to work in an on-demand fashion,” said Dave Clark, senior vice president of world-wide operations. “This is another opportunity for people to work with the company.”
It is also the latest move by Amazon in its perpetual drive to lower shipping costs and pare delivery times as it seeks to become the central commercial hub for all shoppers. As part of those efforts, Amazon is building out its own last-mile network and has turned to a widening variety of couriers and delivery workers. to shuttle goods to their destinations—not to mention its goal of delivery by drone.
The new service would give Amazon more control over the delivery experience, including proprietary mobile routing and tracking software, and help contain shipping costs that grew 31% last year, faster than revenue.
But by relying on an on-demand workforce, Amazon also risks plunging itself into the center of a contentious debate roiling Silicon Valley over whether such laborers deserve full benefits and pay.
Read the full story at Amazon Taps ‘On-Demand’ Workers for One-Hour Deliveries [webpage no longer available].