TOKYO -- Amazon Japan aims to build a team of 10,000 independent couriers in the Tokyo region by 2020 to continue offering same-day delivery service without relying on major parcel delivery companies.
Private deliverers tend to subcontract with transport companies, and their work is often concentrated during heavy business periods such as the end of the year. Amazon's move could help sustain their work all year, as well as possibly help alleviate Japan's delivery driver shortage.
Amazon is estimated to ship about 300 million packages per year in Japan, which would represent just under 10% of the country's door-to-door parcel deliveries.
Rounding up drivers
In Tokyo, the epicenter of demand, private couriers will be organized by logistics company Maruwa Unyu Kikan, which handles deliveries for such clients as online grocers. The company will take on Amazon's same-day delivery by organizing a team of independent couriers and outsourcing the work. It has already begun the same-day service in some parts of Tokyo's 23 wards.
Maruwa aims to fence in private couriers by strictly regulating work hours while guaranteeing steady work and revenue. It will also offer worker dormitories, fuel discounts and training. When necessary, it will also rent out minitrucks that are easy to drive even in metropolitan areas and will encourage new drivers to sign on.
Maruwa already has built a fleet of several hundred minitrucks. It aims to increase the number to 1,000 and secure enough drivers for them by the end of fiscal 2017, which ends March 2018, to cover central Tokyo. By fiscal 2020, the operation is expected to grow to 10,000 trucks and 10,000 drivers, handling same-day deliveries to major cities in the Tokyo region. With additional delivery hubs also on the docket, the total investment is seen surpassing 10 billion yen ($89.7 million), a burden Maruwa will bear.
A shifting landscape
The jobs-to-applicants ratio for cargo delivery drivers -- including truck drivers -- was 2.01 in 2016, according to the Ministry of Health, Labor and Welfare, far outstripping the all-sectors average of 1.25 and denoting a severe labor drought. One reason is that pay is comparatively low for the heavy labor.
Many minitruck courier businesses are owned by sole proprietors. Since such operations can be started easily with just one vehicle and registration with the national government, Japan had some 154,842 such businesses as of March 2016.
Amazon has at least 10 delivery hubs throughout Japan, and offers same-day delivery in urban areas around the country, besides outlying islands. Deliverers including Yamato Transport and Japan Post, a Japan Post Holdings group company, have carried its packages, but the Yamato Holdings unit -- Amazon's biggest deliverer -- is scaling back its same-day deliveries, with an eye toward pulling out completely. This has forced Amazon to remove the noon-to-2 p.m. slot as a delivery option in central Tokyo and some other areas.
A number of e-commerce companies, primarily those that rely heavily on Yamato, have had to change their delivery timeframes. Askul, the operator of a popular online mall for stationery and office supplies, altered its timeslot options as of Tuesday in accordance with changes made by Yamato. E-tailer Start Today, which operates an apparel shopping site called Zozotown, has had to do likewise.
Askul is searching for ways to maintain its delivery network, including by handling many more deliveries itself for one of its e-commerce sites catering to individuals.