Amazon is set to invest further in its smaller “same-day site” warehouses, as it focuses on ultrafast delivery amid a slow down in ecommerce demand and increased competition from rivals.
“We’re always exploring ways to bring our customers new levels of convenience and delivery options that work best for them. Same-Day Delivery is one of the latest innovations,” an Amazon spokeswoman told the Wall Street Journal.
Amazon also reported that more than 1.5 million customers a month are trying same-day delivery for the first time.
The report in the WSJ also highlighted that the US retail giant has opened around 45 of its smaller same-day warehouses in the last four years and could expand to at least 150.
MWPVL International, which monitors Amazon warehouse operations, found these sites are primarily based near larger cities and deliver Amazon’s most popular items. Amazon told the WSJ that new locations include Los Angeles, San Francisco and Phoenix, though the company declined to say how many same-day sites it has.
Amazon currently uses contractors to make deliveries from its same-day sites. MWPVL expects that by using same-day warehouses Amazon can eliminate other costs that apply to its wider fulfilment system. Marc Wulfraat, MWPBL president, noted: “They need volume to make it work.”
Amazon’s focus on same-day warehouses follows news that it will look to sublet UK warehouses it is currently not using, and will close distribution centres in Hemel Hempstead, Doncaster and Gourock. At the time CEO Andy Jassy explained that Amazon was aware that it was “building more capacity than we needed”. He added that the firm has chosen to “shade on the side of consumers, and being able to serve them in that extraordinary time.”
Amazon is still planning to open new sites at Peddimore in the West Midlands and Stockton-on-Tees in the North East.