In context: Before the holidays, Amazon made a rather controversial decision when it banned its third-party vendors from using FedEx Ground and Home (Air was still usable) to distribute their goods. While FedEx insists that the ban has had a “minusculous” effect on its company, the timing has been inconvenient. The holidays are probably the most crucial time for product sales and shipments, and for businesses like FedEx they are therefore very significant.
Of note, Amazon’s decision wasn’t completely out of the blue. The corporation itself says the FedEx ban was a result of the shipping giant’s “declining performance.” It is conceivable, however, that the ban might have been retaliatory in nature.
FedEx had ended its ongoing relationship with Amazon earlier in 2019, citing concerns about the growing distribution network of the retail giant itself— FedEx wanted to avoid working too closely with a direct competitor.
Even Amazon will probably admit this logic is sound, but from time to time, tech firms have been known to hold on to small grudges.
However, apart from speculation, it seems Amazon has agreed for the time being that its competitor shipping company has been punished appropriately. Amazon claimed in an email sent to its merchants (viewed by CNBC) that FedEx’s delivery efficiency is once again meeting its lofty expectations, so the restrictions were lifted.
Once again, third-party vendors can use FedEx Ground and Home to ship their goods, while still qualifying for the Prime ranking. Those sellers can of course remain disappointed. After all, before the biggest sales season of the year, many were forced to make potentially unwanted improvements to their shipping infrastructures.
For others, though, this news could take on more of a positive tone, “better late than never.” In the end, a stable relationship between Amazon and shipping companies such as UPS and FedEx is a good thing to retailers, as it allows them more opportunities to get their goods in front of consumers.