An Amazon Delivery Station in Alpharetta, Georgia.
Justin Sullivan | Getty Images
Amazon has been working towards same-day and next-day delivery as the new standard for its Prime members.
Recently, Amazon announced a significant milestone in achieving this goal. In 2022 alone, the company has delivered 1.8 billion units to U.S. Prime members within one or two days, which is four times more than the same period in 2019.
To achieve faster delivery times, Amazon has invested heavily in improving its warehouse and delivery network. While the COVID-19 pandemic presented some challenges, the company has managed to restore normal delivery speeds through the opening of new warehouses and operational enhancements.
Last quarter, Amazon achieved its fastest Prime speeds ever.
One major change Amazon has made is moving away from a national “hub and spoke” fulfillment network to a model with eight smaller regions and local facilities stocking commonly ordered items. This shift has not only reduced costs but also improved delivery speeds.
According to Udit Madan, Amazon’s Vice President of Transportation, their fastest speeds are also the most cost-effective. By driving fewer miles and minimizing touchpoints, Amazon has reduced its “cost to serve.”
The company has also enhanced its machine-learning technology to optimize inventory placement in warehouses, further accelerating delivery times. In over 60 major U.S. metro areas, more than half of Prime orders now arrive within one or two days.
The speedier delivery offered by Amazon has led to increased purchases from customers, surpassing what they would typically buy locally or from other retailers.
To support faster delivery, Amazon is expanding its network of “same-day sites” – smaller buildings located near large metro areas where products are fulfilled, sorted, and delivered from a single location. These sites offer a tailored selection of items based on local customer preferences.
Amazon plans to double the number of same-day sites within the next two years.
While the exact number of same-day sites is undisclosed, The Wall Street Journal reported that Amazon has opened approximately 45 facilities since 2019, based on data from MWPVL International, a logistics consulting firm.
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