Last-mile can often be "golden". For many products long-haul is a commodity business. In today's (and probably tomorrow's) tight market for trucking, fleet management is fundamental. But there is not much need or pay-off for mass customization. A case can even be made that such a strategy is non-scalable (so far).
But within twenty-or-so miles of a supply node, customization is almost constant. As more products are increasingly delivered direct to consumers, the needs and potential pay-offs of effective -- systematic -- customization will grow.
UPS and Fedex have clearly benefited from this trend. USPS as well. Uber is targeting the potential.
Last week Baird Equity Research suggested that Amazon is beginning to probe (then adapt, then accelerate) operations as a direct-delivery provider.
According to Baird's analysis:
Our assessment of Amazon's broadening fulfillment ecosystem, internal domain expertise, and early initiatives with Prime Now to offer third-party delivery suggests there is evidence Amazon may ultimately pursue more comprehensive third-party services. Similar to the gradual rollout of AWS, we would expect Amazon to introduce competitive transportation and logistics services on an incremental basis, with a long-term focus.
Ideal customers for ATL (Amazon Transportation & Logistics) would range from SMBs to enterprise businesses that lack financial resources, expertise, or technology horsepower to manage fulfillment/logistics internally, and with an offering that raises the competitive bar vs. incumbent service providers. Amazon currently operates >165 fulfillment centers worldwide, and is already testing “last mile”delivery of products not sold via Amazon’s websites.
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