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Amazon overcomes supply chain disruptions by self-managing container shipping
Amazon has been self-managing container shipping since 2018 and can manage 70-75% of shipments through its shipping network. Currently, Amazon ships more than 10,000 containers each month on its own.
Amazon self-deploys container shipping (Photo: G2 Ocean)
The unprecedented Covid-19 has put pressure on the global supply chain and as things begin to trend towards the recovery and the global economy reopens, it has created many bottlenecks in the supply chain. The trade boom with increased demand has caused container freight rates to skyrocket up to $20,000 compared to the pre-pandemic pre-pandemic price of less than $2,000.
However, e-commerce giant Amazon seems the least affected by the conundrum of shipping containers. Foresight and jumping into container shipping since 2018 has helped the company get rid of port congestion - the most undesirable problem in freight today.
Amazon has been self-managing container shipping since 2018 and can manage 70-75% of shipments through its shipping network. Amazon logistics has managed to ship more than 5,300 containers from Beijing to ports in California and Washington state. Since then, Amazon has ramped up its operational self-reliance and now ships more than 10,000 containers per month.
Furthermore, the e-commerce giant founded by Jeff Bezos in 1994 has also hired its own bulk carriers, which gives them an advantage in shipping route planning and creating better efficiency in its transport ecosystem, avoiding delays and backlogs at ports.
Amazon has invested about $4 billion to avoid port congestion and backlog issues for better vessel turnaround times. This has given the big company a big advantage in the e-commerce space, shipping nearly 72% of its shipments, up from 47% previously.
Retailers have been turning to financially well-designed strategies from chartering bulk carriers to shipping their own containers. Companies like Walmart and Home Depot are following this strategy, but Amazon, with its long legs and foresight, has an unparalleled advantage over others.
Read more:
- Will shippers consider container vessel chartering as a long-term supply chain strategy?
- Many shippers will restructure their supply chains and charter ocean capacity direct
- Amazon, Ikea, Unilever... join the coZEV project - Cargo Owners for Zero-Emission Vessels
- Home Depot charters container ships to solve supply chain bottlenecks
- Global supply chain disruption expected through 2022
Source: Phaata.com (According to Containernews)
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