Guess who owes their early success to the US Postal Service? Here’s a hint: it’s now the biggest eCommerce company in the world, and it just broke ground on a new Prime airport in Kentucky. The answer? Amazon (NASDAQ:AMZN). In an interview given on Monday, Amazon CEO Jeff Bezos credited USPS for helping the company get off the ground. Hats off to Bezos for giving the Postal Service credit where credit is due!
USPS Is Still Crucial for eCommerce Businesses, Big and Small
In the interview with CBS Evening News, Bezos touched on the important role that USPS played in Amazon’s early success.
“I didn’t have to build a transportation network to deliver the packages,” he said. “It existed. It was called the Post Office.”
Amazon wasn’t the first company to rely on the US Postal Service…and it won’t be the last. USPS is still critical for eCommerce businesses that rely on its delivery network to delivery their items to customers. In fact, the fact that small businesses in any part of the country can take advantage of USPS’ affordable rates and unparalleled delivery network is one of the main reasons that American eCommerce has boomed the way it has.
USPS is the only carrier that can legally touch every single mailbox in the country, which is why the other shipping carriers all partner with USPS for last mile delivery. Even though Amazon is now investing nearly a billion dollars in its own delivery network, it also still relies on the Postal Service to deliver its packages past the last mile.
President Trump May Not Sympathize With Bezos’ Remarks
While Bezos’ USPS shoutout gives us a warm and fuzzy feeling, his comments may stoke some fires burning in the White House. President Trump has long attacked Amazon’s use of the Postal Service, claiming that Amazon abuses the relationship and treats USPS like their “delivery boy.”
President Trump tweeted in April: “Only fools, or worse, are saying that our money losing Post Office makes money with Amazon. THEY LOSE A FORTUNE, and this will be changed. Also, our fully tax paying retailers are closing stores all over the country…not a level playing field!”
The President’s comments are not without validity. USPS is losing money. However, it isn’t Amazon’s fault. The Postal Service is in dire financial straits because of onerous legislation Congress enacted in 2006. This legislation requires USPS to set aside millions of dollars to pre-fund future employees’ health and retirement benefits. Plain and simple, it’s the real reason why USPS keeps losing money year after year.
While President Trump may not take kindly to Bezos’ remarks, we can all agree on one thing: Bezos’ interview sheds light on exactly why Amazon and the rest of America needs the US Postal Service.