An India-based Amazon Company Had 60% Rise In Its Revenues

The Amazon Transportation Services company that is based in the capital of India’s southern Karnataka state known as Bengaluru has reported a humongous rise of 60% in their revenues. This company serves the American electronic commerce and cloud computing giant that is based in Seattle, Washington as its logistics arm. This rise of almost 60% from the previous year’s number in revenues in FY18 is undoubtedly consistent to the growth pace this company has experienced in their last financial year. After all, they must continue to take into account the expanding request from Amazon's commercial center business at all times.

The revenues of Amazon Transportation Services have experienced an incredibly huge gain that pushed them to the incredible number of Rs 1,574 crore. To make a comparison, in their last financial year, the Amazon Transportation Services company had managed to muster up their revenues to Rs 991 crore. The numbers we use here were obtained from the regulatory filings on paper.vc. There are also other incomes that together make up for an amount of Rs 10 crore, the main contribution to this number is the interest on their bank loans.

This is in no way a one-time miracle, as in the previous financial year the company has experienced a similarly huge gain in revenues that is almost 60%, too. In FY16, Amazon Transportation Services reported that their revenues had touched Rs 619 crore and that number became Rs 991 crore in FY17.

As can be seen from the regulatory filings on paper.vc, the company’s operations are all to cater to “a single customer in India that is a fellow subsidiary of the holding company, and all assets are located in India.” The filings clearly illustrate that Amazon Transportation Services was in a contract that states that they offer a sale of services to the Amazon Seller Services. So, what is the Amazon Seller Services? It is Amazon’s marketplace business in India.
In the regulatory filings on paper.vc, the company has also stated that they intend to continue focusing on heavy investments on building infrastructures and business in the logistic field in order to expand while taking into account the needs for growth in the future. This is the reason the company’s expense has also experienced a considerable increase when we compare it to the number of the last financial year. To be more specific, the company’s expenses rose from Rs 1,010 crore to Rs 1,608 crore. This brings out the losses of Rs 24.7 crore.

After some digging, we were finally able to find out the component that took up the biggest percentage of Amazon Transportation Services. It was the service fee for delivery. The number of this fee almost doubled from the amount of Rs 594 crore in the financial year 17 to a whopping Rs 1,015 crore in this financial year.

To work out a solution for this obviously pressing issue, Amazon has made a considerable increase in its network of third-party delivery. To be more specific, Amazon has doubled the amount Service Partner Network in the last mile to an undoubtedly humongous number of over 700 stations throughout almost 500 cities. This means there will always be one station or more in these 500 cities. This is not the extent of what Amazon has been doing, as they have been simultaneously boosting the “I Have Space” program. This program is about working with the stores available in the neighborhood to make the last-mile delivery. Last year, this program had an already big amount of retail outlets that is 17,500. However, this is clearly not enough for Amazon as they have increased the number to 20,000 retails in this year. In addition, Amazon has almost doubled the fleet’s amount of vendors. With this addition, the already huge army of trucks that Amazon has run on the street has become even more formidable. The exact number of the Amazon trucks running around in the street is now officially 1,500, an incredible number.

All in all, Amazon also increased their storage capacity to over 20 million cubic feet by increasing their number of fulfillment centers to over 50. This number is almost over 1.5 times of the one in the same category in the last financial year. At the moment, Amazon is also having a number of sort centers that are close to 30. These centers are evenly spread across about 17 states and they have a total processing area of almost 1 million square feet.