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Amazon is reportedly conducting pilot tests of its own delivery service in the U.S. and hopes to expand the system across the country beginning next year.

Bloomberg, citing sources familiar with the plan, reported that the e-retailer first introduced its delivery program in India two years ago. The initial U.S. tests are taking place on the West Coast, but Amazon is already discussing expansion plans with its merchants.

Under the system, Amazon would pick up goods from third-party warehouses and deliver them to customers.

The company reportedly aims to make more products available for its rapid-delivery Prime program, but the proposed initiative would also ease congestion in Amazon's warehouses by keeping goods in seller's distribution networks instead.

Amazon last year designated millions of new items as eligible for Prime — even though the merchants handled the shipments — in a similar move to clear warehouse capacity.

In addition, Amazon long sought more control over rising shipping costs, and Bloomberg noted that the new system could provide more flexibility — particularly along the expensive final miles of a product's route — and enable volume discounts.

The effort, however, also appears likely to draw Amazon into increased competition with longtime parcel partners such as UPS and FedEx.

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