Amazon Seeks to Improve Deliveries to Israel, but Not Planning to Open Logistics Center

Attempts to improve customer experience come amid development of a Hebrew-language site, as the company signals rising interest in Israeli market

An Amazon package seen after being delivered.
\ Toby Melville/ REUTERS

The U.S.-based online retailing behemoth Amazon is seeking to improve its delivery service to Israeli customers, but an Amazon logistics center in Israel does not appear to be on the horizon in the near term.

In recent weeks, representatives from Amazon have met with Israeli package delivery providers including the Israel Postal Company, DHL, TNT and Flying Cargo’s Boxit service to examine possible options for improving delivery service in the country.

This isn’t the first such attempt. In November, Amazon representatives met with the CEOs of several delivery firms in Israel to hear what they would have to offer. As it stands now, delivery of Amazon packages to Israeli customers is handled by a number of different companies. Most are handled by Israel Post’s courier service, which spares the recipient of the package from going to the post office to pick it up. The remaining parcels are handled by a number of commercial delivery firms, including DHL, TNT and Federal Express, as well as Boxit, which has a network of collection points around the country including retail stores and banks of lockers.

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Since October of last year, Amazon had expanded the range of products that it ships to Israel by about a million items. The additional items are actually provided through third-party sellers that use the Amazon website to reach a larger audience and are not products that Amazon itself sells. It is estimated that the number of orders shipped to Israeli customers increased by 40% in the four months between January and April of this year compared to the period last year.

At the same time, Amazon is developing a Hebrew-language website. About a month and a half ago, the company published job openings for translators from English to Hebrew for the Amazon website and services offered through the site.

All of this prompts the question, however, as to whether this is a prelude to opening a logistics center in the country that would make Amazon a more formidable competitor to local retailers. Executives from delivery services in Israel expressed the view that the recent efforts on Amazon’s part to explore options to improve its delivery through local delivery firms are actually an indication that it is not planning on opening a logistics center, where it would store merchandise, anytime soon.

“At Amazon, they have been thinking about opening a logistics center in Israel,” said an executive for one delivery firm, “but in looking into it, they are finding that it could actually be a colossal mistake.” They would lose an advantage, the source explained, when they ship items from abroad.