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Amazon plans to double its same-day delivery sites

Amazon plans to double its same-day delivery sites
Posted at 8:15 AM, Aug 01, 2023

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If it seems like you’re getting your packages from Amazon faster and faster, you’re not alone — and it’s not your imagination. In an announcement on July 31, the company said it had reached its “fastest Prime speeds ever” in the last three months, and it’s not stopping there. Amazon has plans in the works for increasing its same-day delivery services as well.

“Same-Day Delivery is currently available on millions of items for customers across more than 90 U.S. metro areas, and we have plans to double the number of sites in the coming years,” Amazon revealed in the announcement.

Amazon is brimming with products that qualify for free Prime shipping — north of 300 million. And a large percentage of that (tens of millions) are eligible for free same-day or one-day delivery. Last quarter, when the company shipped Prime member packages to the 60 largest U.S. metro areas, more than half were delivered on the same or the next day, according to the announcement.

In 2023 so far, more than 1.8 billion products arrived within the same day (or the next day) to the homes of Americans with Prime memberships. This is almost four times faster than the company’s delivery rate in 2019, when the retail giant announced it was investing $800 million in faster delivery for Prime Members.

“Our goal is to evolve the two-day free shipping program into the one-day free shipping program,” Amazon CFO Brian Olsavsky said in a quarterly earnings call with investors in April 2019. At the time, the company had announced the investment toward that goal, but no timeline.

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Since then, Amazon has regionalized its operations, dividing the country into eight sections with operational sites serving smaller geographic areas. Rather than having one central location for its products, it keeps a wide selection of inventory in each of these areas. The company says that more than 76% of the orders delivered to a customer come from within the customer’s region.

The company uses algorithms to predict what customers in those regions will buy. They already have an idea about what will be the top-selling Amazon products in each state, so they make sure to have that inventory on hand there.

And Amazon is still adding same-day facilities, which are smaller buildings in closer proximity to the regions they serve. These “hybrid” facilities are more streamlined, so they can get a package to the outbound dock in 11 minutes.

“These hybrid facilities allow us to fulfill, sort, and deliver all from one site — making the entire process of delivering customer packages even faster,” said Doug Herrington, CEO of Worldwide Amazon Stores, in the announcement on July 31. “And with connections to the larger Amazon fulfillment centers nearby, we dramatically increase the number of items available for fast delivery.”

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