Amazon is teaming up with the United States Postal Service to deliver goods on Sunday. The online retailer will start its service in New York and Los Angeles but expects to roll out the program in more cities next year.
Delivery of goods has been a competitive space for online retailers, said Rebecca Lieb, an analyst at the Altimeter group.
“Delivery has always been a point of high customer loyalty in the retail space,” Lieb said. With the holiday season ramping up and retailers like Wal-Mart, Google and Ebay offering stiff competition in the delivery space Amazon is upping the ante and offering Sunday service.
The United States Postal Service is hoping to make money off the partnership, said Donald Broughton, a transportation analyst for Avondale Partners.
“If you look at the economy that UPS, FedEx, and the Post Office serves, it’s been a slow-growth no-growth economy except in the area of e-commerce,” Broughton said.
Broughton says with direct mail falling off as a source of income, the postal service expects to lose about $6 billion dollars this year. But E-commerce has been the one bright spots in delivery services.