Amazon Says Regionalization of Fulfillment Centers Is Working

Amazon’s new approach to its fulfillment centers is working, according to an announcement on Monday where it boasted it is delivering its largest selection of products to US Prime members at the fastest speeds ever.

Amazon CEO Andy Jassy revealed the new approach to its fulfillment network in his annual letter to shareholders in April, where he explained Amazon had carved up its national fulfillment network into 8 regions that were self-sufficient so in order to lower costs and speed up delivery times.

On Monday, a spokesperson for the company shared the following statistics with EcommerceBytes:

• Across the top 60 largest U.S. metro areas, more than half of Prime member orders arrived the same or next day in Q2.
• So far this year, Amazon has delivered more than 1.8 billion units to U.S. Prime members the same or next day—nearly four times what they delivered at those speeds by this point in 2019.
• During Prime Day this year, Amazon shipped more units with Same-Day Delivery than any other two-day period in the company’s history.

The CEO of Amazon Stores Doug Herrington said in Monday’s announcement that 300 million items are available with free Prime shipping, and he said tens of millions of the most popular items available with free Same-Day or One-Day Delivery.

You can read Herrington’s message on the Amazon corporate blog and watch his message on YouTube:

Here’s what Herrington said about Amazon’s “Regionalizing” of its US operations network:

“In short, we divided the country into smaller, easier-to-reach regions. Previously, we fulfilled orders from any of our operational sites across the country. 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. Today, more than 76% of the orders we fulfill come from within the customer’s region. Items shipped from nearby fulfillment centers or delivery stations helps packages get to customers not only faster, but also with fewer emissions.”

Ina Steiner

Ina Steiner is co-founder and Editor of EcommerceBytes and has been reporting on ecommerce since 1999. She’s a widely cited authority on marketplace selling and is author of “Turn eBay Data Into Dollars” (McGraw-Hill 2006). Her blog was featured in the book, “Blogging Heroes” (Wiley 2008). She is a member of the Online News Association (Sep 2005 – present) and Investigative Reporters and Editors (Mar 2006 – present). Follow her on Twitter at @ecommercebytes and send news tips to ina@ecommercebytes.com. See disclosure at EcommerceBytes.com/disclosure/.