According to a recent report, Amazon makes free shipping harder to get for non-Prime members as the company has recently hiked the minimum order size from $35 to $49. Fortunately, the free shipping minimum stays the same for book orders – $25.
Apparently, the e-commerce giant wants to attract more Prime users. Amazon Prime offers two day shipping free of charge plus free video streaming for $99 a year. Last year, the number of Prime members rose 51 percent globally and 47 percent in Northern America. On the other hand the company’s shipping expenses skyrocketed 37 percent to nearly $2 billion in 2015.
Shipping costs are currently one of the company’s largest expenses. So, getting a deal on shipping outside Prime seems to become increasingly difficult. The last time the company hiked the order size for free shipping was in 2013.
Amazon declined to comment on the rise, but obviously the move was designed to lure in more Prime subscribers. The retailer is in a race against time to revamp its shipping infrastructure. Prime Now is a service that can bring your products to your doorstep within an hour since you placed the order.
Plus, the e-commerce giant is working on an international delivery network that would allow it to control all the products in the supply chain from manufacturing plants to last-mile delivery services.
But Amazon Prime is the company’s most important asset in its plans to make logistics hyper efficient. So, no wonder that it tries to compel more customers to pay for a Prime subscription. Soon, it may become pointless to use Amazon and not go Prime.
For instance, for an average shopper that places a few orders every year, Prime looks like the best deal out there. It offers free and reliable shipping, free video streaming service and surprise goodies such as original shows. But if you are not yet convinced, maybe the $49 free-shipping minimum will do it.
Amazon has been quietly working on a clockwork infrastructure for years now. And oftentimes it has sacrificed profit to growth for this purpose. In the last two decades, the e-commerce giant has poured billions in its logistics in an effort to make delivery as fast as the blink of an eye.
In order to have your products delivered to you within an hour, the company had to coordinate its warehouses, equip those centers with robots, and hire hundreds of thousands of couriers. Plus, there are rumors that Amazon is working on delivery drones for urban areas to trim costs even further.
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