Amazon is a logistics beast - A detailed teardown

This virtuous cycle constantly strengthens Amazon’s logistics play.

The more asset-as-a-service scales, the larger the ecosystem using Amazon’s logistics infrastructure and the greater the data capture for Amazon to constantly improve its prediction models

Leverage data across the ecosystem to constantly improve prediction models

Leverage supply-side scale to open out asset-as-a-service to ecosystem partners

Gain data scale through demand-side integration

Gain asset scale through supply-side integration

Amazon’s logistics play follows a common playbook that we’ve seen in other parts of Amazon’s business:

Amazon demonstrates that platforms don’t have to be asset-light, they just have to be strategic about asset ownership. Amazon increases asset ownership were such assets increase ecosystem dependance, and opens itself at other parts of the value chain where it needs third parties to bring in niche capabilities to complement its own.

Amazon’s approach to logistics is a masterclass in balancing vertical integration vs openness.