Amazon said on Monday it will open up its vast logistics network to external businesses, allowing them to store and ship goods ranging from raw materials to finished products. The move is an important step as the company targets a market long dominated by UPS and FedEx.
Branded as “Amazon Supply Chain Services”, the offering enables companies across sectors, including retail, healthcare and manufacturing, to tap into Amazon’s end-to-end logistics infrastructure spanning ocean, road, rail and air.
The expansion positions Amazon as a formidable contender in the U.S. logistics sector, potentially intensifying competition around pricing and delivery speed. The company already operates a fleet of more than 100 cargo aircraft, second only to FedEx and UPS, alongside an extensive network of warehouses and sorting facilities.
Investor sentiment reflected the shift, with shares of FedEx and UPS falling more than 9 per cent each, while Amazon’s stock edged up nearly 1 per cent.
The initiative also opens up a new growth avenue for Amazon’s e-commerce business, building on capabilities it already provides to thousands of third-party sellers globally. Businesses using the service can benefit from delivery timelines of two to five days, along with tools such as inventory forecasting and integrated fulfilment.
Analysts at Evercore ISI described the move as “a direct competitive blow” to traditional parcel carriers like UPS and FedEx. Contract logistics players, including DHL Supply Chain, Maersk Logistics and GXO Logistics, are also expected to feel the impact.
Amazon said the service is designed to support businesses across all sales channels, including their own websites, social media platforms and physical stores. It has already onboarded major clients such as Procter & Gamble, 3M and American Eagle Outfitters.
By expanding into business-to-business (B2B) shipping, which involves transporting goods between businesses rather than to individual consumers, Amazon is targeting a high-margin segment where deliveries are typically more predictable, denser, and cost-efficient compared to consumer shipments.
