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Logistics & Fulfilment

Amazon reducing Prime delivery times to one day

Amazon has announced it will spend US$800 million to cut delivery times for Prime members from two days to one.

Amazon chief financial officer Brian Olsavsky unveiled the operation during the company’s recent earnings call following its first-quarter earnings results last week, which saw the brand double its quarterly income to US$3.56 billion.

“We’re currently working on evolving our Prime free two-day delivery shipping program to be a free one-day shipping program,” Olsavsky said, according to USA Today.

“We’re able to do this because we’ve spent 20-plus years expanding our fulfilment and logistics network, but this is still a big investment and a lot of work.”

The news pushed shares in competitor Walmart down 3 per cent, while Target dropped 5 per cent, as investors reacted to Amazon making a large-scale investment into its already-robust delivery offering.

However, not all parties involved took the news well, with the Retail, Wholesale and Department Store Union president Stuart Appelbaum noting this change would put undue stress on Amazon’s warehouse associates.

“With two-day Prime shipping, Amazon fulfilment workers currently face speeds of 200-300 orders per hour in 12-hour shifts. They struggle already to maintain that pace,” Appelbaum said.

“If Amazon plans to effectively double that speed, it must also address existing workforce needs and ensure its workers are safe.

“Increasingly fulfilment speeds means they need to hire more workers, under more sustainable speeds that don’t put workers’ lives in jeopardy.”

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