Amazon employees are getting an opportunity to become business owners, as the online retail giant announced earlier today that it would be expanding its Delivery Service Partner program. Created last year to encourage drivers to start their own package delivery services, the program now includes additional incentives to make the transition easier.
Dave Clark, senior vice president of worldwide operations at Amazon, said the program’s expansion came after nearly a year of “overwhelming interest.”
“Tens of thousands of individuals … applied to be part of the Delivery Service Partner program, including many employees,” Clark said. “We’ve heard from associates that they want to participate in the program but struggled with the transition. Now we have a path for those associates with an appetite for opportunities to own their own businesses.”
What Program Participants Get
Officials said the Delivery Service Partner program has facilitated the creation of more than 200 small businesses throughout the U.S. since its inception in June 2018. Thousands of new package delivery jobs were created as a result, bolstering the number of vehicles on the road dedicated to getting Amazon packages to their destinations.
Previously, the program gave employees – or any entrepreneur – access to Amazon’s delivery technology, hands-on training, and discounts on things like Amazon-branded vans, uniforms and insurance. At the time, officials said successful delivery business owners could earn upward of $300,000 per year with a fleet of 40 vehicles. Naturally, a small business won’t get that big overnight, but Amazon was betting that some startups would grow into successful partners.
With today’s announcement, Amazon is also including a $10,000 incentive to cover startup costs, as well as three months’ pay, to encourage Amazon employees to participate in the program. Employees who opt in to the program will leave the company “so employees-turned-business-owners can more easily get their package delivery companies off the ground.”
With Amazon’s growing use of automation at its packaging facilities threatening to replace jobs by the thousands, the Delivery Service Partner program and other initiatives offer workers assistance in pursuing other careers.
Amazon announced that workers in the U.K. and Spain will also get a shot at starting their own delivery services.
How Amazon Benefits
As the world’s largest online retailer, Amazon has a lot of moving parts. Customers, however, don’t generally care how an item gets to them, as long as it’s quick.
In recent years, Amazon has tried to speed up the process by adding outside contractors to the equation. Programs like Amazon Flex, which acts as a sort of Uber for packages, enabled the company to crowdsource its delivery apparatus but often drew negative attention. Codifying the entrepreneurial side of Amazon delivery services by giving startups access to its technology could standardize the entire process.
While Amazon will likely shell out a lot of money through this program, there’s something to be said for the overall savings the corporation could realize. With more of its own drivers on the road, the mega-retailer will steadily decrease its reliance on traditional shipping methods like the USPS, UPS and FedEx.
The company’s push to fuel its own package delivery services could help it reach its recently announced goal of offering one-day shipping to all Amazon Prime members. Amazon announced last month that it would spend approximately $800 million this quarter to reduce the default Amazon Prime shipping time by a day for more products.