“They basically went from zero containers a month a few years ago, to over 10,000 containers a month,” said Steve Ferreira, an ocean freight consultant. But Amazon has been preparing for this moment since the mid-2010s, when it started booking space on cargo ships to provide a more seamless link between Chinese factories and its warehouses. Other big retailers, including Walmart, have also chartered freighters or sought to hitch a ride on ships loaded with iron ore, coal, grain, or other commodities, freight consultants say. “It reduces the gray areas where the shipping process might fail.” Gonzalez said his company, which has been using Amazon’s global logistics service, has about 95 percent of the inventory it needs to meet holiday demand. “It’s a one-stop-shop from Asia to Amazon,” said Walter Gonzalez, CEO of Miami-based GOJA, which sells various products on Amazon including Magic Fiber cleaner for glasses. Other services have lots of intermediaries where cargo swaps hands, presenting opportunities for miscommunication and delays. Amazon also simplifies the process since it oversees the shipment from China to its US warehouses. Knopfler said Amazon’s prices were “phenomenal,” $4,000 to ship a container from China compared with the $12,000 demanded by other freight forwarders.
“If Kim Jong Un had a container, I might take it, too. “Amazon had space on ships and I couldn’t say no to anyone,” said David Knopfler, whose Brooklyn-based sells home décor and lighting fixtures. For years, they resisted using the company’s global shipping service because doing so means sharing information about pricing and suppliers, data they fear the company could use to compete with them.īut container shortages in the leadup to the holiday season persuaded many of them to overcome their qualms and entrust their cargos to the world’s largest online retailer. This logistical prowess hasn’t been lost on the merchants who sell products on Amazon’s sprawling marketplace. “Amazon has its own transportation network, it has access to all the carriers. “There are structural advantages you have in redundancy if you’re Amazon,” said Jason Murray, a former Amazonian who led teams working on logistics software. If the company succeeds in meeting its promises to customers this year, that will be thanks to Amazon-chartered ships taking products from factories in Asia, Amazon Air cargo jets crisscrossing the US, Amazon-branded vans departing from hundreds of local delivery depots, and the hundreds of thousands of employees and contractors at each step along the way. But for Amazon, which burnished its reputation serving as a lifeline during the COVID-19 outbreak, the holiday season is an opportunity to extend its advantage over rivals. The logistical effort’s projected $4 billion cost threatens to wipe out the company’s profit during its most important three months of the year. It’s dispatching half-full trucks to get packages to customers on time.
In addition to chartering ships like the Olive Bay, Amazon hired 150,000 US seasonal workers to help pick, pack, and ship items, boosting pay and offering signing bonuses of up to $3,000. Amazon’s unflinching message: Bring it on!
Many retailers have exhorted consumers to shop early to avoid disappointment. Such extreme measures have given Amazon executives confidence they’ll have adequate inventory to meet yet another record-breaking holiday shopping season, when Adobe projects US consumers will spend $207 billion online, up 10 percent from last year. Besides Everett, the company has also docked at the Port of Houston. By chartering the Olive Bay and dispatching it to a relatively sleepy port a few miles north of hometown Seattle, Amazon did an end-run around the shipping snarls that have stranded holiday inventory in Los Angeles and other ports.