Amazon has launched ‘Amazon Flex’, an Uber like platform for parcel delivery, reports The Financial Times.
The company is signing up amateur drivers to make deliveries in their spare time, following a trend of ‘gig economy’ of informal employment made popular by Uber’s successful business model. Amazon began testing this model in Seattle last year.
The ecommerce group will offer British car owners cash to deliver parcels between a local distribution center and customer homes.
Amazon expects UK delivers to begin in Birmingham, where it has been advertising on online jobs websites such as Craigslist since June.
It will initially use freelance drivers to make same-day deliveries under its ‘Prime Now’ service, which offers a range of 15,000 products for delivery within one hour.
How would the platform work?
A smartphone app will allow the company’s part-time drivers to choose when and where they want to work, as well as guide them to customers’ homes and allowing the customers themselves to track their orders. Although the company is pitching this idea as ‘an opportunity to be your own boss’, it is actually taking itself a step closer to the legally contested territory of ‘sharing economy’ employment arrangements.
Amazon estimates that ‘Flex’ drivers will be paid between $17-$19 an hour, including tips (13-15 pounds). However, the hourly rate is not guaranteed and could be lower if the driver takes more time than Amazon predicted to deliver the parcels. Amazon cited research from the Centre for Economics and Business Research, which found that 68% of people who did not have a job would be inclined to start working if they had flexible hours.
Since 2012, Amazon has set up delivery stations near clusters of customers and hired small companies to deliver on its behalf. The move has left traditional courier companies, such as Royal Mail to deliver to Amazon customers in remote locations, while depriving them of some of their more profitable work. This has also placed Amazon into a competitive market. It is still a wild west, particularly for home delivery, where a lot of operators are losing money.
A version of this appeared in The Financial Times on July 20. Read the full version here.