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FedEx's Revised Rates Help Amazon Beat Smaller Online Retail Rivals

May 9, 2014: 12:00 AM EST
Shipping company FedEx’s plan to revise its shipping rates to charge based on the size of a package and not just its weight is likely to help Amazon.com in competing against smaller Internet retailers. Further demonstrating how Amazon.com’s size is helping it to expand its share of the online retail market, this development has also seen FedEx adding incentives for the online retail giant to keep using its service. With the huge volume of business it brings, Amazon is able to negotiate its own shipping rates with FedEx and other shipping companies. To deal with this FedEx move, online retailers are expected to use shipping boxes smaller than the ones they are currently using.
Claire Cain Miller, "FedEx’s Price Rise Is a Blessing in Disguise for Amazon", New York Times, May 09, 2014, © The New York Times Company
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