Amazon Gets Project Armada to Indian Market
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Amazon is betting high on the Indian market. Soon after investing INR 2700 crore in its India's arm, the e-commerce giant is now introducing Project Armada to the domestic market.
According to an Economic Times report, the project will allow entrepreneurs to manage a fleet of delivery trucks. Earlier this year, the project was introduced in the US market, which helped entrepreneurs to make USD 300,000 per year with about 40 such trucks.
While on the other side, the Amazon would lease these trucks at discounted prices and it would sport the company’s logo. Additionally, it would also incur the cost of fuel, insurance, etc.
The report cited sources aware of the development saying that Amazon has already started the pilot project in Delhi and is keen to work with logistics companies that will help them lease vehicles to entrepreneur.
The American Way
According to a regulatory filing, Amazon acknowledged the risk associated with relying on external partners like FedEx and UPS while it said if it is unable to negotiate acceptable terms with these companies or they experience performance problems or other difficulties, it could negatively impact the giant’s operating results and customer experience.
Additionally, the report also noted that shipping costs, which includes sorting, delivery centre and transportation expenses, zoomed from USD 11.5 billion in 2015 to USD 21.7 billion in 2017. And these costs are predicted to go high.
While announcing the Project Armada in the US market, Dave Clark, Senior Vice President, Amazon said, “We have great partners in our traditional carriers and it’s exciting to continue to see the logistics industry grow.”
Having said, that Dave also added that the customer demand is higher than ever and Amazon needs to build more capacity.
“As we evaluated how to support our growth, we went back to our roots to share the opportunity with small-and-medium-sized businesses. We are going to empower new, small businesses to form in order to take advantage of the growing opportunity in e-commerce package delivery,” he pointed out.
According to Amazon’s CEO Jeff Bezos – India market is full of opportunities as entrepreneur sees potential in the local economy.
Amazon, by far, as pumped in roughly around USD 4 billion in the Indian market. The giant has heavily invested in India to build infrastructure, technology, warehousing, logistics, along with discounting product and increasing the reach of Amazon Prime.
To improve its hyperlocal delivery game in India, earlier last month in September, Amazon along with Samara Capital acquired Aditya Birla Group-owned More retail chain for INR 42 billion.
These moves are directed to help Amazon to hedge on the deal of the year – Flipkart’s acquisition by Walmart.
However, who will the winner in the great Indian e-commerce war? Well, the customer knows it better.