Grocery, Fresh Targeted In Amazon’s Explosive Warehouse Growth Plan

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Amazon’s entry into the same day delivery business is accelerating at a lightning pace. And while dry grocery, HBC and general merchandise will hold strong positions in its new and expanded fulfillment centers, the Seattle-based online juggernaut is also looking to expand distribution points for its perishables-driven AmazonFresh unit.

The explosive online merchant announced last month that it plans to hire 7,000 workers, with 5,000 of those positions at new distribution centers slated to be built over the next 24 months. Most of those new job will offer pay and benefits far above typical retail wages, the company said. Additionally, Amazon will add about 2,000 service positions at new and existing customer service locations.

The 5,000 fulfillment center jobs would represent a 25 percent increase in current staffing in that department. Amazon has been increasing its network of fulfillment centers and warehouses in order to offer quicker shipping to more of its customers. Many Amazon customers now have the option of next-day delivery and the company is looking to offer same-day delivery on some items.

Analysts see Amazon’s expansion as an effort to more effectively compete (and gain market share) against bricks and mortar merchants like Wal-Mart (the world’s largest retailer) as well as other online merchants such as eBay.

Amazon has listed fulfillment center jobs that are available at recently opened Mid-Atlantic distribution centers in: Breinigsville, PA (LehighValley); Middletown, DE; Chester, VA; and Huntington, WV.

Nationally, jobs are being added at new distribution centers in: Chattanooga and Murfreesboro, TN; Charleston and Spartanburg, SC; Patterson, San Bernadino and Tracy, CA; Coppell, Haslet and San Antonio, TX; Hebron, KY; Indianapolis and Jeffersonville, IN; and Phoenix, AZ. The customer service jobs are in: Grand Forks, ND; Kennewick, WA, Huntington, WV; and Winchester, KY.

In the Mid-Atlantic region, in addition to new depots opened in the past 18 months in Middletown, DE and Chester, VA, Amazon has opened a new warehouse in Petersburg, VA.

The mega-merchant is also looking to build a new one million square foot distribution center in Baltimore. That reported site is at the former General Motors facility on Broening Highway in the southeast part of the city. The developer would be Duke Realty Corp., a real estate firm that often works with Amazon.

Additionally, currently under construction is a one million square foot “dry” facility in Robbinsville, NJ (Mercer County) which should open next year. Amazon will also reportedly open an AmazonFresh depot in Avenel, NJ to serve the Metro New York market (a 564,000 square foot distribution center that C&S formerly occupied to supply A&P and Pathmark stores until that business was shifted to another C&S facility in Central Pennsylvania last year). AmazonFresh currently operates in Seattle and Los Angeles and is eyeing other major metropolitan markets to compliment its core business.

The recent spending spree on infrastructure has affected Amazon’s bottom line. In its second quarter ended June 30, Amazon posted a net loss of $7 million on sales of $15.7 billion, a 22 percent increase.

Amazon CEO Jeff Bezos has always looked at the long-term outlook, so quarterly losses are not uncommon at one of the world’s fastest growing firms. And shareholders continue to believe in Bezos’ philosophy because its stock price continues to gain momentum. At the end of the day on September 6, Amazon was trading at $282 per share, a 17 percent increase over the past 12 months.

According to its SEC filings, as of December 31, 2012, Amazon employed approximately 88,400 full-and part-time associates, a five-fold increase from only five years earlier.