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Mon Jan 14 2008 09:45:31

Amazon Stories Highlight Etail Shipping Challenges

By: Ina Steiner

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A New York Times reporter and a ZDNet UK reporter failed to receive expensive consumer electronics they had ordered from recently for the same reason: neighbors who signed for the packages but did not give the packages to the rightful recipients.

Joe Nocera of the New York Times received a replacement PlayStation 3 from - a happy ending. ZDNet UK's David Meyer had yet to follow through with Amazon UK to see if they would send a replacement iPod.

Both stories point out the challenges faced by every online seller: the shipping/delivery process.

"Shipping is one of the greatest friction points of ecommerce," writes Scott Devitt of Stifel Nicolaus in today's report on Amazon ("Devitt's & Credits: Amazon Business Review - Amazon Prime Edition"). With 26 fulfillment centers throughout the world (15 in the U.S., 1 in Canada, 6 in Europe, and 4 in Asia), has a physical presence in seven of the top-nine GDP countries in the world, which account for $27 trillion of combined GDP or 70% of the top-50 GDP countries, Devitt writes.

"At the core of Amazon's competitive advantage is its logistic expertise. We believe Amazon to be becoming one of the largest customers of logistics providers (UPS, Federal Express, and DHL) in certain shipping categories."

Yet even can't ensure the drivers at shipping companies make the best decisions when confronted with an empty apartment at delivery points. What hope do small mom & pop sellers have? I wondered who paid for the replacement PS3, was it covered under the carrier's insurance policy?

Both reporters' stories highlight the challenges of fulfillment issues, especially around the holidays. As a small merchant, do you send replacements for items that customers say they never received - even when signed for? Do eBay sellers have to worry about Star Ratings (DSRs) going down due to such mix-ups? How cooperative are shipping companies in dealing with such issues, and are some better than others? Do you have your own tales of shipping-gone-wrong?

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by: Joyful Alternative

Tue Jan 15 21:55:57 2008

Maybe the reporters ought to move to a friendlier neighborhood! I had a FedEx package signed for by a neighbor once, and the neighbor delivered it to my door, along with profuse apologies, a few hours later.

(No, not a rich neighborhood, a working-class Philadelphia neighborhood.)

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