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Home » Prime Hike Gives Amazon Warchest for Fight Over Postal Costs

Prime Hike Gives Amazon Warchest for Fight Over Postal Costs

May 1, 2018
Reuters

President Donald Trump has been laying into the Seattle-based online shopping firm in recent weeks for what he says is a deal with publicly-owned USPS which effectively lumps much of the cost of thousands of daily deliveries onto U.S. taxpayers.

Trump has said that if USPS raised parcel rates, Amazon would face $2.6bn in extra cost, although equity analysts who follow billionaire Jeff Bezos’ company estimate a much lower number and say the deal may actually be keeping USPS afloat.

Several said that Thursday’s move by the company to raise Prime fees to $119 a year from $99 starting June 16 would not faze many of Prime’s estimated 60-65 million U.S. members.

“The incremental $20 membership fee could result in an incremental $1.2bn to $1.3bn of revenue which should more than offset any rational USPS price increase,” Deutsche Bank analyst Lloyd Walmsley said.

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    KEYWORDS All Warehouse Services Business Strategy Alignment E-Commerce/Omni-Channel Express/Small Shipments Global Supply Chain Management Logistics Logistics Outsourcing LTL/Truckload Services North America order fulfillment Regulation & Compliance Retail SC Finance & Revenue Management SC Planning & Optimization Technology Transportation & Distribution Transportation Management
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