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Amazon Reportedly Ramps Up Logistics Expansion

Media reports that Amazon is currently stepping up efforts to expand logistics to improve its competitive position in the market, where companies such as Walmart, Shein, and Temu are also present.

Amazon Reportedly Ramps Up Logistics Expansion

The mentioned e-commerce giant, which already owns the best American delivery service, is focused on restructuring its distribution network. Also, according to media reports, Amazon is considering the possibility of acquiring industrial property. The corresponding efforts of the e-commerce giant are aimed at enhancing package delivery speed and reducing shipping costs.

According to information released by the media, since the beginning of the current year, Amazon has leased, bought, and announced plans for more than 16 million square feet of new warehouse space in the United States. This expansion will add to the e-commerce giant’s existing industrial footprint, which currently stands at about 413 million square feet across North America.

Amazon has also overhauled its domestic shipping network. The company has shifted from a highly centralized network to nine regions that are designed to operate independently. The corresponding strategy of the e-commerce giant is aimed at placing goods closer to consumers, which helps to reduce delivery times and lower costs.

In the fourth quarter of 2023, Amazon reported that the number of orders delivered on the same day or the next day increased by more than 65% year-on-year in the United States.

Currently, the e-commerce giant requires third-party merchants that interact with the e-commerce giant’s virtual platform to hold inventory in multiple locations rather than in a few centralized locations. It is worth noting that Amazon also adheres to the appropriate approach.

The e-commerce giant is opening centers for inbound receiving centers, which are large warehouses spanning from 600,000 to over 1 million square feet. These facilities are designed to store products throughout the United States.

Amazon also leases small warehouses in rural areas to serve as delivery stations. This approach minimizes transportation final-mile transportation costs.

One of Amazon’s main competitors, which it is, Walmart utilizes its vast network of more than 4,600 stores in the United States to fulfill online orders.

Serhii Mikhailov

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Serhii’s track record of study and work spans six years at the Faculty of Philology and eight years in the media, during which he has developed a deep understanding of various aspects of the industry and honed his writing skills; his areas of expertise include fintech, payments, cryptocurrency, and financial services, and he is constantly keeping a close eye on the latest developments and innovations in these fields, as he believes that they will have a significant impact on the future direction of the economy as a whole.