Amazon Has Quietly Started Delivering Packages

Amazon Flex. Does that service ring a bell? It didn’t for me, not until I read Gizmodo’s exhaustive piece last week entitled Amazon’s Last Mile. It begins:

Who delivers Amazon orders? Increasingly, it’s plainclothes contractors with few labor protections, driving their own cars, competing for shifts on the company’s own Uber-like platform. Though it’s deployed in dozens of cities and associated with one of the world’s biggest companies, government agencies and customers alike are nearly oblivious to the program’s existence.

Flex is in 50 cities already (and may be coming to my area soon). It seems as though Amazon has quietly made quite a bit of progress in phasing out their reliance on FedEx, UPS, and the USPS.

With that said, the service is rife with problems. Most notably, drivers are (probably illegally) operating as independent contractors:

The way Liss-Riordan sees it, the issue at hand is labor misclassification: Amazon and similar companies pay drivers to do the work of employees, but treat them as independent contractors, denying them basic amenities like health care, benefits, and workers’ compensation in the event of an on-the-job injury—something which two of the drivers we spoke to reported experiencing.

And because of this, they’re not driving Amazon vehicles or wearing Amazon attire, which results in suspicious neighbors calling the police:

Not so happy are some Kansas City-area police departments. Without company logos identifying the vehicles or their drivers, Flex deliverers in their regular street clothes are “bound to draw attention from people saying there’s a suspicious person circling the neighborhood,” said John Lacy, public information officer for the Overland Park police.

Requiring that they wear an Amazon polo shirt with a pair of khakis, and giving them a magnet to stick on their car, would solve this problem, but of course that would make them look even more like employees, something Amazon won’t admit until the courts force them to do so. And I do think eventually the legislation will rule against them and these people will rightfully be designated as employees, but I also don’t think that will be that large of a deterrent in the end.

FedEx, UPS, and the USPS have repeatedly stated that they’re not worried about this…which is probably a lie, because if they’re being even remotely honest with themselves this should worry the heck out of them. It’s not too hard to see this play out in a similar fashion to the way that Uber and Lyft are playing out vs taxi drivers. The quote from a UPS spokesman in the article even makes some of the same arguments:

UPS spokesman Dan McMackin told Gizmodo that Amazon is not a threat to UPS — whose drivers are both full employees and the single largest contingent of long-lived Teamsters labor union — because “ecommerce is bigger than one customer.” In his opinion, good courier work requires a skilled, consistent workforce, and retaining that pool of labor means providing solidly middle-class wages and benefits.

The thing is, people don’t care who delivers their package as long as it gets there. Just like they want the most frictionless way to get from A-to-B. They don’t care about labor unions or taxi regulations, even if those regulations are supposedly put in place to protect them.

The USPS, in particular, is the most logical “last mile” partner for Amazon because they’re already going to every house in the US every day. And while that’s currently the case – Amazon receives a huge subsidy from the USPS – that doesn’t appear to be in Amazon’s long term plans. It’s hard to see it costing Amazon less in the short term, or even the medium term, but that’s not Amazon’s game. They like to control the entire pipeline, and they’re willing to lose money for a long time to achieve that because they understand the tremendous long term advantages.

For all of the “they’ll never do that because it costs too much and would take too long” comments, it seems as though they’ve already started doing it, they’re fine with spending the money, and it’s not taking them all that long. And if you’re still not convinced, check out the text on the bottom of the Flex website:

Want to build the future of delivery? Amazon is hiring for job openings in engineering & technology, product management, and design.

That sounds an awful lot like a company gunning for UPS, FedEx, and the Postal Service.

4 comments on Amazon Has Quietly Started Delivering Packages

  1. Rob says:

    I think the poor economy and workers rights are leading to massive exploitation by companies that rely on so-called “gig economy” workers. Uber, Deliveroo and these “self-employed couriers”. With stagnant economies, the only way to deal with it seems to be with legislation.

    https://www.theguardian.com/money/2016/jul/18/life-as-a-hermes-driver-they-offload-all-the-risk-on-to-the-courier is an interesting watch

    https://www.theguardian.com/inequality/2017/aug/24/inside-gig-economy-vulnerable-human-underbelly-of-uk-labour-market and this is an interesting read.

    Give it another 10 years or so and drones/autonomous tech/3d printers or something will have probably taken a lot of these rubbish jobs anyway, which is better for society as a whole, but not really that good for those struggling to find work.

    I think the future of work is going to be very interesting indeed.

    • Adam McFarland says:

      Agreed! That video is really good. He was hustling and it took him 6.5 hours to do a 2-3 hour route!

      • Rob says:

        I watched the video on that article you posted too. He managed to do a 3h30 route in 1h45 because he’s better at route planning than Amazon’s app… I would have really thought they’d have that nailed by now.

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