How Amazon air freight operations could save the firm $1bn a year

© Ifeelstock

If you still haven’t had enough of reading about Amazon’s freight aspirations, there is an interesting analysis here on how the company’s costs will change by switching to its own air freight operation. Note Jeff Bezos’s quote, one to strike fear into the heart of any of its suppliers: “Your margin is my opportunity”. The article points out that Amazon’s shipping costs rose from $884m in 2006 to more than $11.5bn in 2015, an annual average rate of 33%. Amigobulls reckons that Amazon paid UPS and FedEx $1.5bn last year, while the cost of its air freight operations would be about $489m. That leaves, says the article, $1bn in savings. Although it doesn’t seem to have counted the cost of the final mile, aircraft being notorious for preferring to land at airports rather than the final destination.