Amazon is making one-day shipping the standard for Prime members.
During the company’s first-quarter earnings call last Thursday, Chief Financial Officer Brian Olsavsky said that Amazon plans to shorten the current two-day default free shipping plan to one day from Prime members.
”We’re currently working on evolving our prime free two-day shipping program to be a free one-day shipping program,” Olsavsky said.
In order for these changes to happen, Amazon will be planning on spending over $800 million in the second quarter to improving warehourse and delivery infrastructures said Olsavsky at the conference call. This investment in return will also be cutting into Amazon’s profit margins and due to that the company has prepared for that.
Currently, Amazon does have one-day and two-hour shipping for certain products for an extra cost but this change would increase the amount of items available for one-day shipping along with the free cost that comes with being a Prime member. Olsavsky did state that currently the company offers over 100 million items for free two-day shipping. The change will first take place in the North American market, Olsavsky noted, but is designed to expand globally, across all countries that offer Prime memberships. Amazon said last year that it has over 100 million Prime members worldwide.
He aslo did state that he would use all available resources to make free one-day shipping possible which include existing partnerships with the U.S. Postal Service and UPS as well as Amazon’s very own third-party delivery network. Olsavsky declined to give more details about the change like the timeline for the one-day shipping saying that the move involves many different moving parts and that “We’re taking a significant step.”