Shipping Wars: Amazon Rate Hike, Warehouse; E-Bay Competes
Amazon has raised its minimum order for "Free Super Saver Shipping" from $25 to $35, saying to customers that "this is the first time in more than a decade that Amazon has altered the minimum order for free shipping in the U.S."
"Free shipping has long been a cornerstone of Amazon.com's growth strategy," observed Paulo Santos in a post at Seeking Alpha. "Moving this threshold is a borderline desperate measure. A measure which would only be taken if Amazon.com internally was looking at some seriously ugly numbers." The company reports third-quarter results tomorrow, which had already been expected to be in the red.
In addition, the New York Times reported the online retailer had made another "at the edges" change earlier this summer, when "devoted Prime users discovered that the company had started charging variable amounts according to size and weight, with a minimum of $2.99," rather than the previous deal through which Prime customers received free two-day shipping service, but could get next-day delivery for an additional $3.99 per item.
Amazon plans to open a one million-square-foot fulfillment center in Baltimore that will create more than 1,000 full-time jobs. In its announcement, the company said, "We are grateful to the state and local elected officials who supported Amazon coming to Maryland and we look forward to being a part of the community."
On another shipping battlefront, eBay has acquired Shutl, a "marketplace that uses a network of couriers to deliver local goods on a same-day basis," ReadWrite reported, adding that Shutl, "which lists its speediest delivery to date as a little under 14 minutes after purchase, could give eBay a leg up on same-day shipping rival, Amazon. Currently, Amazon offers same-day shipping in select American cities."