Amazon.com Inc has quietly opened a series of small warehouses closer to big US cities in a move to shave hours off delivery times, the company said.
On March 3, the world's largest online retailer is updating its same-day delivery programme for shoppers in Phoenix, Philadelphia, Dallas and Orlando, it said. Amazon will guarantee packages arrive by several set times daily.
The initiative underscores the company's aim to stay quick in online retail, outdoing competitors' free two-day delivery offers so shoppers remain loyal to Amazon's shipping and media-streaming club Prime, which costs US$119 per year in the United States.
Amazon has long offered one or two-hour delivery via Prime Now, a service that includes fresh groceries and more than 20,000 items.
The same-day offer will now guarantee delivery of more than 100,000 products, from phone chargers to dog food, in as little as five hours, from a new warehouse close to each launch city, said Jon Alexander, Amazon's director of delivery experience. For comparison, Amazon offers more than 100 million items for two-day US delivery or faster via Prime.
"The smaller selection enables us to put these types of facilities much closer to customers," he said. Additional items - up to three million - will pass through the facilities on their way to same-day customers.
The new format combines the storage, picking and packing functions of Amazon's fulfillment centres with the sorting and delivery functions of other facilities into a single building.
Compared with fulfillment centres, which are farther from urban cores and house much more inventory, the new warehouse is roughly a tenth the size, at 100,000 square feet (9,290 sq m). Amazon says shorter drive times will help it meet its pledge on carbon emissions.
The company declined to comment on the facilities' cost. Amazon, once famous for spending away profit, often cites warehouse build-outs as one of its biggest areas of investment.
According to Alexander, Amazon would typically lease existing spaces and alter them to accommodate the operation.
The new facilities are automated with the same "drive units" used in Amazon's fulfillment centres. These are squat, floor-scurrying robots that hoist up movable shelves of inventory and bring them to associates who pick customer orders. Amazon said each building will create hundreds of full and part-time jobs.
While the same-day option is covered for Prime members who spend at least US$35 , those without Prime are charged US$12.98 per order, a tactic that could draw people to sign up.
Amazon will announce more cities for the programme later this year, Alexander said.
- Reuters
Created by Tan KW | Aug 17, 2024
Created by Tan KW | Aug 17, 2024
Created by Tan KW | Aug 17, 2024