The retail sector’s giant middleman is getting a little bit bigger.
Amazon confirmed this month that it’s taking its freight brokerage nationwide, roughly 18 months after it launched a pilot program in five Northeastern states.
The company’s goal is said to be twofold. First, to own as much trucking capacity as it can, which it can use for its own freight or to sell to other shippers at cost or for a small profit. And, second, to add truck capacity hurdles for its retail competitors to deliver their products to market, whether that be a retail store or a home delivery, especially during peak shipping seasons.
Amazon has opened up its freight.amazon.com portal to more shippers, and it’s trying to drum up dedicated service from small- and mid-sized trucking companies.
Whether it will use its power as a massive freight mover and brokerage to drive down shipping rates remains to be seen. In a statement to Overdrive, Amazon says it simply intends to use the new brokerage to “better utilize its existing freight network.”
Put that way, it becomes somewhat obvious — the company already operates a giant brokerage, even if the freight-world moniker isn’t typically applied to them.
Amazon is inherently a middleman operation, linking brands to consumers and then taking a cut for arranging the transaction, as retailers have always done. In the same vein, however, when a product sells, the company then quickly arranges truck service between warehouses, distribution centers and homes.
