Amazon is reportedly expanding its selection of ultrafast delivery options through its network of specialized warehouses, called same-day sites, according to The Wall Street Journal. These facilities are significantly smaller than traditional fulfillment centers but are designed to prepare items for immediate delivery — and Amazon is poised to expand from 45 same-day sites (as of 2019) to at least 150 in the next several years, according to MWPVL International.
The same-day sites are primarily located near major cities and focus on stocking the 100,000 most popular items in the ecommerce giant’s portfolio. These can enable Amazon to offer ultrafast delivery options for Prime members, though they carry an additional fee of $2.99 for orders under $25.
The additional fees are likely due to the costs of fast shipping due to factors such as using contractors to make deliveries. Last-mile costs at same-day sites are estimated to be about $3.30 per package, compared to $1.75 per package at traditional fulfillment centers, according to MWPVL. However, the firm noted that the new sites can eliminate some costs associated with the standard fulfillment system.
New same-day sites have recently opened in Los Angeles, San Francisco and Phoenix, Amazon told The Wall Street Journal. The retailer declined to specify the exact number of same-day sites it operates, though it noted that more than 1.5 million customers are trying same-day delivery for the first time each month.
“We’re always exploring ways to bring our customers new levels of convenience and delivery options that work best for them,” said an Amazon spokesperson in a statement. “Same-Day Delivery is one of the latest innovations.”
Amazon has been narrowing its focus as the company considers stepping back from unprofitable ventures, such as some of its non-grocery physical stores, as the retail industry as a whole braces for a tough economic climate. However, CEO Andy Jassy has emphasized that Amazon is still making significant investments in areas where it sees growth potential, such as brick-and-mortar grocery.