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FedEx Opens New Front in War With Amazon

By Lou Whiteman - Dec 2, 2020 at 3:12PM

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The transportation company is buying ShopRunner, which operates a Prime-like membership service.

FedEx ( FDX 2.35% ) on Wednesday said it intends to acquire e-commerce platform ShopRunner for an undisclosed price, adding a new dimension to the shipping giant's growing rivalry with Amazon.com ( AMZN -1.38% ).

ShopRunner is a membership program that offers free two-day shipping, free returns, and other benefits when members buy from one of its 100 retail partners. The benefits are similar to what Amazon offers through its Prime service.

A FedEx delivery truck in a city setting.

Image source: FedEx.

The deal should bring FedEx closer to some of its biggest retail customers. FedEx president and chief operating officer Raj Subramaniam said the acquisition "aligns with our continued efforts to create an open, collaborative e-commerce ecosystem that helps merchants deliver seamless experiences for their customers."

In a statement announcing the deal, FedEx said that ShopRunner's pre-purchase offerings complement FedEx's post-purchase logistics services.

This isn't the first time FedEx and Amazon are bumping elbows. In recent years, the e-commerce giant has aggressively built its delivery capabilities, bringing in-house business that traditionally went to FedEx and other transport giants.

Last June, FedEx declined to renew an Amazon contract for expedited delivery service, preferring instead to "focus on serving the broader e-commerce market." Later in the year, Amazon ceased using FedEx Ground for deliveries and temporarily barred third-party sellers from delivering Prime-eligible packages through FedEx's network.

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FedEx Corporation Stock Quote
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