Topline
The one-upmanship between retail behemoths Walmart and Amazon continues this week, with a report that Amazon plans to open up to 1,500 small delivery hubs in cities and suburbs across the U.S. to offer speedier delivery and gain ground in the current retail theater — serving the at-home consumer.
An Amazon associate processes a package for delivery at the newest Amazon Robotics fulfillment … [+]
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Key Facts
Citing people familiar with the plans, Bloomberg reported Wednesday that the retail giant is looking to get ever more granular with its warehouse and distribution strategy.
Amazon did not immediately respond to requests for comment.
News of the potentially expanding delivery hub network comes about a month after the Wall Street Journal reported that Amazon was in talks with Simon Property, the biggest mall owner in the U.S., to explore the possibility of turning vacant store space previously occupied by ailing retailers J.C. Penney and Sears into distribution hubs for the e-retailer.
Big Number
640,000. That’s how many square feet are in Amazon’s newest fulfillment center in Beaumont, California, which opened in early September, a sign that the e-commerce giant is approaching distribution from new and traditional fronts.
Key Background
This week also marks the launch of the Walmart+ service, the nation’s largest retailer’s answer to Amazon Prime, a key driver of growth for Amazon. For an annual fee of $98 (or $12.95 per month) Walmart+ members get unlimited delivery from the brand’s 4,700 U.S. stores at no additional cost, along with fuel discounts. The coronavirus pandemic has made many consumers shy about visiting stores in person and most major retailers, including Target and Kroger, have stepped up efforts to accommodate consumers who’d rather not come inside. Using the existing store network as a mini-distribution hub helps retailers keep up their important “sales per square foot” numbers. Amazon, which gobbled up retail market share in part by offering speedy delivery, would be able to offer more grocery items within an hour if it could store goods closer to consumers’ doorsteps.
Further Reading
Amazon Plans to Put 1,000 Warehouses in Suburban Neighborhoods (Bloomberg)
