Amazon’s One-Day Delivery System Drives Revenue Profits Cost Up 21%
Amazon.com Inc. recently reported its first profit in two years and revenue income upsurge in the current quarter. This is owing to higher spending by online retailer one day delivery to spur sales growth in the year 2019. The company is focusing on investing high on one-day delivery of products for Prime members. This is for staying ahead from competitors such as Walmart Inc. and others. The company investing huge money for faster shipping of products with revenue escalating over 20% to US$ 63.4 billion during the 2nd quarter in the year 2019. The company announced a plan to spend more on the formation of an effective delivery system. This is carried out to prepare for the winter holiday shopping season sale for the year 2019.
Amazon.com Inc. has expanded the one-day delivery system to more than 10 million products globally. US-based Amazon company has registered more than 100 million paid subscribers to its Prime services ‘loyalty club’. In which the company offers by releasing numerous unique TV shows. And wide range of gadgets with advance features including voice assistant such as Alexa. The company offers services such as speedy shipping for numerous goods, including groceries through its own subsidiary Whole Foods Market. Amazon is moving towards a marketplace model. In which it can earn more profit by serving other merchants.
In June 2019 revenue from seller services increased by 23 % to US$ 12.0 Bn in the 2nd quarter. The Ad and other sales increased by 37 % to US$ 3.0 Bn. The cost exceeded to over US$ 800 million. This cost is more than what Amazon had estimated to spend on the initiative in the 2nd quarter. Many retailers are allowing customers to pick products and delivery on the same day. These services help the company to maintain its share in the competitive market. Amazon is expanding US services to global customers as well as strengthening its Amazon Web Services (AWS) sales staff and marketing for products and services.