Amazon eliminated several underperforming small express companies, resulting in thousands of job losses


In recent months, Amazon has ended contracts with several small express companies, resulting in the dismissal of more than 1200 delivery drivers.
Amazon recently ended cooperation with at least seven small express companies, resulting in the dismissal of about 1205 delivery drivers and the closure of related facilities, the report said.
These small express companies are part of Amazon’s express service partner program (DSP). As early as June 2018, Amazon launched its DSP program to solve the “last mile” distribution problem.
DSP plans to allow U.S. entrepreneurs to operate their own truck networks, but with Amazon’s “prime” logo. This will encourage entrepreneurs to set up their own small express business. Amazon said at the time that entrepreneurs could set up their own express business for at least $10000, excluding the cost of hiring a driver.
“Having 40 trucks can make up to $300000 a year,” said David Clark, Amazon’s senior vice president for global operations Clark also estimated that a fleet of 20 to 40 trucks would typically need to employ about 100 drivers.
Now, Amazon has ended cooperation with some DSP delivery companies, forcing them to close stores and announce layoffs. It is reported that courier distribution systems, a delivery partner in Georgia, will lay off 273 drivers in Pennsylvania and Wisconsin. Systemize, a Massachusetts based logistics company, is closing its Connecticut and New York stores, cutting 121 jobs.
In addition, Maryland based TL transportation is cutting 80 jobs in Pennsylvania and closing a New York facility, resulting in 76 layoffs. Prime EFS, based in New Jersey, was forced to lay off 338 employees in the state and Pennsylvania.
In addition, JST transportation cut 51 jobs in Massachusetts, deliver global cut 41 jobs in Pennsylvania, and Sheffield express cut 95 jobs in Connecticut, and will close facilities there.
In response, an Amazon spokesman said in a statement that the company regularly evaluates its express partnership. In another round of layoffs that began in February, Amazon also terminated contracts with transportation brokerage specialists, bear down logistics, express parcel service, delivery force and several other companies, resulting in at least 2000 layoffs.
Although Amazon ended cooperation with several underperforming delivery partners this time, its DSP plan has grown rapidly since it was launched two years ago. Amazon said in a blog post earlier this month that there are more than 1300 DSP partners from five countries, creating 85000 jobs and delivering more than 1.8 billion packages worldwide.