How to Become an Amazon Logistics Partner?

India's e-commerce sector is rapidly expanding. There is an increase in demand for efficient delivery services. Amazon's Delivery Service Partner (DSP) program offers entrepreneurs a chance to establish their delivery businesses with Amazon's support. Participants receive training, access to Amazon's logistics technology, and assistance in setting up operations. With low startup costs and a built-in customer base, the DSP program presents a promising opportunity for those looking to enter the logistics industry. In this article, you will learn in detail about how to become a logistics partner of Amazon, the benefits, investment strategy, and more.

What is a logistics Partner?

A logistics partner is a certified service provider that helps businesses move and store goods throughout the supply chain. They take care of transport, warehouse operations, and inventory controls. They ensure goods reach customers on time and in good condition. A logistics partner uses experience and resources to cut costs and reduce delays. This support lets businesses focus on their main goals. The partnership improves service quality and boosts growth in a competitive market.

Understanding the Role of Logistics Partner with Amazon

A logistics partner and a Delivery Service Partner (DSP) with Amazon share similar responsibilities. They manage delivery operations and ensure timely deliveries.  However, a DSP operates under Amazon's brand, utilises Amazon-branded vehicles and technology.

Amazon's DSP program allows entrepreneurs to start their own delivery business with minimal logistics experience. Partners manage a fleet of Amazon-branded vehicles, hire and train delivery associates, and oversee daily operations. Amazon provides support through training, technology, and access to a network of service providers. This collaboration offers entrepreneurs an opportunity to build and grow a business with the backing of a global e-commerce leader.

Eligibility Criteria to Become a Delivery Service Partner with Amazon

Listed below are the eligibility criteria to become a delivery service partner with Amazon:

• Financial Requirements: A minimum of ?6–8 lakh in liquid assets is required for small delivery business whereas Rs. 25-30 lakh for medium to large delivery businesses.
• Business Experience: While prior business experience is not mandatory, leadership skills and team management experience are advantageous.
• Legal Requirements: Applicants must have a registered business entity and comply with local regulations, which include GST registration.
• Background Checks: Amazon conducts thorough background checks on applicants, evaluating work history, experience, education, and financial information to determine eligibility.

Investment and Financial Overview

Below is the investment and financial overview that one should keep in mind before becoming a part of Amazon’s Delivery Service Partner (DSP) Program:

1. Initial Investment Breakdown

• Vehicles: Amazon offers leasing options for branded delivery vehicles. The cost varies based on fleet size and lease terms.
• Uniforms and Devices: Amazon provides uniforms and handheld devices for drivers at no additional cost to the DSP.
• Insurance: Comprehensive insurance, which includes vehicle damage, liability, and cargo, is mandatory.
• Training and Onboarding: Costs associated with training programs for drivers and administrative staff. Amazon provides training resources and support to ensure compliance and operational efficiency.

2. Ongoing Operational Costs

• Salaries and Benefits: Partners are responsible for paying driver wages, which vary based on location and experience.
• Maintenance and Repairs: Routine maintenance and repairs are essential for fleet management.
• Fuel and Utilities: Fuel expenses depend on delivery volume and regional fuel prices.

3. Administrative Expenses: Costs related to business operations, which includes accounting, legal services, and other administrative functions.

How to become a Logistics Partner of Amazon with DSP?

Amazon’s Delivery Service Partner (DSP) program is mainly for individuals or small business owners who want to start a delivery business exclusively for Amazon. Listed below are the steps that they need to follow to become a part of Amazon’s DSP program

Step 1: Fill Out the Online Application

You need to apply online for the Amazon DSP program. The application takes around 2-3 hours to complete. During this process, Amazon asks about your leadership skills, hiring experience, and financial understanding. You must show proof of at least ?22-24 Lakhs in liquid assets and maintain a good credit history. Before applying for this program, you should ensure your financial standing.

Step 2: Pass the Amazon DSP Program Screening

After submitting your application, you will go through a screening process. During that process, you must provide additional documents, such as your work history and evidence of community engagement. Amazon will conduct a thorough background check, which includes driving records and credit history, to ensure you are a suitable candidate. They will also assess your hiring experience and ability to train and manage a team.

Step 3: Interview Process

Once the screening process is done, Amazon will contact you for an interview. It will take place at a nearby fulfilment centre. The interview process includes multiple rounds and can also take a few months. Amazon assesses your suitability for the DSP program and your ability to manage delivery operations. If you succeed, you receive an acceptance letter to join the program.

Step 4: Complete the Training Program

Once accepted, you need to complete training to understand the operational process. You will go through a week of virtual learning, followed by two weeks of on-site training at a delivery station. During this training, you will learn about safety protocols, best practices for managing a delivery team, and other operational aspects. Other than that, you will also receive a manual to guide your operations and have access to a business coach to assist you during the initial stages.

Step 5: Rent Trucks and Hire Staff

After completing the training, you need to lease delivery trucks and hire drivers. As a new DSP, you will have to start with five trucks and a small team of drivers. While hiring drivers, you should ensure that they are experienced in logistics, have good communication skills and prioritise customer satisfaction. You may hire independent contractors who have already completed Amazon's training program. Once your team and fleet are ready, you can begin your delivery operations.

How to Become a Logistics Partner of Amazon

Established logistics businesses can partner with Amazon. Listed below are the steps that established logistics businesses need to follow:

Step 1:  Understand Amazon’s 3PL Model

Amazon works with third-party logistics providers to help with storage, packing, and delivery of products. These partners handle the movement and management of goods for Amazon sellers. Amazon’s transportation or supply chain teams manage these partnerships. Each agreement includes clear rules and expectations for service quality and delivery speed.

Step 2: Develop Core Capabilities

A logistics business must offer key services such as storing products in warehouses, managing stock, packing orders, and transporting goods. The business needs proper tools and software to track shipments and manage orders efficiently. Good communication and quick problem-solving help to maintain smooth operations.

Step 3: Establish Infrastructure

The business requires warehouses and distribution centres in locations close to customers. This setup helps reduce delivery times and lowers transportation costs. The facilities must meet safety rules and government regulations to operate legally and safely. Proper equipment and trained staff ensure smooth handling of goods.

Step 4: Register as a 3PL Provider

To partner with Amazon as a third party logistics providers, you need to visit amazon’s supply chain website to learn more about becoming a 3PL provider. This may involve submitting an application, providing business credentials and demonstrating your ability to meet Amazon’s service requirements.

Step 5: Negotiate Terms and Service Level Agreements (SLAs)

Once Amazon accepts the business as a potential partner, both sides will discuss the contract terms. These include service standards, delivery timelines, prices, and penalties for failures. SLAs clearly state what performance Amazon expects and what the logistics provider must deliver regularly.

Step 6:  Integrate with Amazon Systems

Once the SLA is negotiated, the logistics company needs to connect its technology systems with Amazon’s order and tracking platforms. This connection allows automatic receipt of orders and real-time updates on deliveries. The integration ensures accurate communication and helps avoid errors or delays.

Step 7: Maintain High Performance Standards

The logistics provider should ensure consistent and reliable service that meets the agreed standards. The company needs to keep track of its performance metrics and improves. Other than that, Amazon also monitors the provider’s work and may end the partnership if standards fall short.

Essential Documents Becoming a Logistics Partner of Amazon:

Listed below are the essential documents that a logistics business needs to submit to register for the Delivery Service Partner (DSP) program of Amazon:

1. Personal Identification Proof

You need to submit personal identification documents, such as the Aadhaar Card and PAN Card. These documents serve to confirm your identity and ensure that you are legally eligible to operate a business in India. They also help Amazon verify your background and business credibility.

2. Business Registration Documents

You must provide proof of your business's legal status. If you run a company, submit the Certificate of Incorporation. For partnerships, the Partnership Deed is required. Additionally, you need to provide the GST Registration Certificate to prove tax compliance and business legitimacy.

3. Financial Proof

To show your financial capability, submit bank statements and proof of liquid assets, which should meet Amazon’s requirement of ?6–8 lakhs. This ensures that you can handle the initial and ongoing costs of running a logistics business and supports the financial reliability of your operations.

4. Vehicle-Related Documents

For each commercial vehicle used in your logistics operation, submit the vehicle’s registration certificate, insurance documents, and fitness certificate. These documents verify that the vehicles are legally registered, insured, and fit for commercial use. This, in turn, ensures that the goods are transported safely.

5. Driver and Staff Documentation

Each driver needs to provide a valid driving license. Additionally, submit background verification reports for each driver and employee to meet Amazon’s standards for safety and trust. These checks ensure that all staff members meet Amazon's hiring and safety criteria.

6. Operational Address Proof

You must submit proof of your business address, such as utility bills or lease agreements. This establishes the location of your operations and ensures that you have a dedicated space for business activities, which Amazon requires to confirm your operational readiness.

7. Photographs

You must submit passport-sized photographs of yourself and staff members involved in the logistics operation. These photographs are necessary for identification purposes and help maintain accurate and updated records for business verification.

Compliance for Amazon’s Logistics Partner

To run a successful delivery business with Amazon, you must follow strict rules and meet specific standards. The compliance measures are listed below:

1. Business Registration

You must set up your business as a Private Limited Company, LLP, or Sole Proprietorship. It is also important for businesses to have a GST number. This helps Amazon identify your business and ensures proper tax structure for smooth operations.

2. Background Verification

Amazon checks your financial status, past work experience, and any criminal record. Your team also needs to undergo clear background and identity checks. This helps Amazon maintain trust and ensures professional conduct.

3. Insurance Coverage

Your business must hold insurance for vehicles, drivers, and parcels. This protects against damage, theft, or accidents. Amazon requires this coverage to ensure uninterrupted service and safeguard all involved parties.

4. Adherence to Safety Standards

You need to follow safety guidelines like regular vehicle checks, proper driver training, and safe equipment use. Amazon performs routine audits to ensure you follow these standards and keep operations risk-free.

5. Employee Management

You must hire staff according to labour rules. All workers should receive fair wages, PF, and ESI if applicable. A safe and respectful work environment also remains essential for long-term business success.

6. Data Security

You must keep customer information secure during delivery operations. Amazon expects strict data protection. You should not share or misuse any data to maintain customer trust and follow company policy.

7. Operational Metrics

Amazon observes delivery time, success rate, and customer feedback. You must meet set benchmarks to stay in the program. This helps maintain service quality and improves overall customer satisfaction.

Benefits of Becoming Amazon’s Logistics Partner

Listed below are the benefits that a logistics business will enjoy after it becomes a part of Amazon’s Delivery Service Partner (DSP) Program:

1. Low Startup Cost

Amazon allows you to start your delivery business with a minimal investment. You need approximately Rs1.5 lakhs to begin with, and a total liquid assets of Rs. 6- 8 lakh. This low entry cost makes it accessible for many aspiring entrepreneurs. Amazon also offers support through negotiated deals and discounts to help you set up your business efficiently.

2. Business Toolkit and Vehicle Support

Amazon provides a comprehensive toolkit to manage your delivery operations. This include access to branded vehicles to discounted lease rates, devices for route management, uniforms and software tools. These resources help you run your business smoothly and maintain high efficiency in deliveries.

3. Full Training and Business Guidance

Amazon offers a structured training program to prepare you so that you can manage your delivery business. This includes a week of online learning and a week of hands-on experience at a delivery station. You also receive ongoing support from a business coach and access to an operations manual to guide you through challenges.

Day to Day work of Amazon’s Logistics Partner 

As a logistics partner of Amazon and being a part of the Delivery Service Partner (DSP) Program, you will have to undertake various daily responsibilities to ensure smooth and efficient delivery operations. Listed below are some of the key task of Amazon’s Logistics Partner:  

1. Route Management: You will have to assigned routes to your drivers. You assess route efficiency and make necessary changes to improve delivery time and reduce fuel use.  
2. Team Supervision: You need to guide your team of delivery associates and ensure they are ready for their routes. You should also conduct small meetings to discuss safety rules, delivery steps and share any updates or concerns.  
3. Vehicle and Equipment Checks: Before dispatch, you need to check all the delivery vehicles and equipment to ensure that they are safe and working properly. Regular checks helps to avoid delays and meets safety rules. 
4. Monitoring Deliveries: You need to track the delivery progress using Amazon’s tools throughout the day. This helps you to see team performance, solve any issues fast, and keep customers happy. 
5. Administrative Duties: You handle daily tasks like making schedules, managing payroll, and following Amazon’s rules. Keeping records clear and following rules helps your DSP business run smoothly. 

Conclusion 

In conclusion, the Amazon DSP program presents a great opportunity for entrepreneurs looking to enter the logistics industry. With minimal investment, access to comprehensive support, and a reliable customer base, the program makes it easier to succeed in the delivery business. If you are wondering how to become a logistics partner of Amazon, the process involves simple steps like applying online, passing screenings, and completing training. 

Though the process may seem challenging at first, expert guidance can simplify it significantly. Among other service providers, Online Legal India provides reliable support. Their expert team will also guide you through the process, which in turn will help you to focus on establishing your delivery business.