Amazon Boasts its 'Delivering at the Fastest Speed Ever'
Amazon.com is delivering its largest selection of products to U.S. Prime members at the fastest speeds ever, according to a blog posted yesterday by Doug Herrington, CEO of Worldwide Amazon Stores.
"With more than 300 million items available with free Prime shipping and tens of millions of the most popular items available with free same-day or one-day delivery, we hit our fastest Prime speeds ever last quarter," Herrington said in the blog post. "Across the top 60 largest U.S. metro areas, more than half of Prime member orders arrived the same or next day. So far this year, we’ve delivered more than 1.8 billion units to U.S. Prime members the same or next day — nearly four times what we delivered at those speeds by this point in 2019."
So how is Amazon doing it? Herrington laid out the company's winning formula in the blog post. It includes the following:
- "Regionalizing” its U.S. operations network: In short, Amazon divided the country into smaller, easier-to-reach regions. "Previously, we fulfilled orders from any of our operational sites across the country," Herrington said. "Now we have eight interconnected regions serving smaller geographic areas. We keep a broad selection of inventory in each region, making it faster and less expensive to get those products to customers."
- Placing products closer to customers: Amazon uses "increasingly advanced machine learning algorithms to better predict which items customers in various parts of the country will want and when they will want them, and we work with our vendors and selling partners to store those products closer to customers," said Herrington.
- Growing its same-day delivery network: Same-day facilities are smaller buildings situated close to the large metro areas they serve, which decreases the distance to customers. "These buildings are designed for speed with smaller footprints, streamlined conveyors, and picking directly to pack stations," Herrington said. "As a result, the average time from picking a customer’s items to positioning the customer’s package on the outbound dock is 11 minutes in same-day facilities, more than an hour faster than our traditional fulfillment centers."
Total Retail's Take: While this is great news for Amazon, it's just the opposite for other retailers competing against the online giant (which all are to some degree). Other retailers without the scale of a company like Amazon may be hard-pressed to achieve this level of speed when it comes to online fulfillment. But perhaps the lesson here is that Amazon is simply giving customers what they want — vast selection, low prices, and fast delivery. "We’re expanding selection, reducing costs, and delivering faster than ever," said Herrington. "And we’re committed to keeping investing and inventing to deliver on those core customer values."