Amazon launched a new service called Amazon Day which enables Prime members to have all their orders delivered on the same day of any given week. While Amazon is selling this new feature as a perk that will help customers take control of deliveries and reduce packaging, the new delivery option could also help the e-commerce giant achieve its ultimate goal of carbon-neutral shipments and, conveniently, save the company a ton of money.
As the following chart shows, Amazon’s shipment and fulfillment costs have skyrocketed over the past decade, with total logistics costs growing 25-fold between 2007 and 2018. Last year alone, the company’s shipping costs amounted to $27.7 billion, with fulfillment costs (e.g. costs of operating and staffing fulfillment centers) adding another $34 billion to a hefty logistics bill. While Amazon’s revenue also grew more than 15-fold since 2007, that wasn’t enough to offset the growth in logistics costs. In 2007, shipping and fulfillment costs amounted to 16.6 percent of net sales. By 2018, that share had risen to 26.5 percent.
