Amazon just figured out how to complete their supply chain cycle
Are we surprised? Not even a little.
It was only a matter of time before Amazon found the final piece of the logistics puzzle to allow them to consolidate and manage ALL the steps from the moment an order is placed online, to the the moment the package efficiently arrives in the hands of the consumer.
Introducing... the locker program, dubbed Hub by Amazon.
In a move that will assist with branding and service, as well as transporting goods from floor to door, Amazon has signed contracts with some of the largest apartment landlords in North America to install locker systems in thousands of apartment buildings representing over 850,000 units. Their commitment is to install these Hub units immediately, hoping to reach many apartment buildings before the peak holiday period. Amazon recognized there was a problem in the final step of deliveries, with many apartment buildings spending hours trying to handle the inflow of packages and their delivery while residents were home; it was causing a logistical nightmare for Amazon and property managers alike. The solution was the Hub locker system, whereby a package (from any provider) can be deposited into an appropriate locker compartment, which will then send an electronic notification to the resident with a code that will allow them to open the respective slot at their convenience. Apartment owners pay about $10,000 - $20,000 to purchase the lockers, and are not required to pay a monthly fee. These lockers are also beginning to be installed at communal locations such as Whole Foods, where users can easily get their deliveries when it is most convenient.
"Karen Hollinger, vice president of corporate initiatives at AvalonBay, which has an ownership interest in about 80,000 apartments, said the average apartment community in the company’s portfolio receives some 1,000 packages a month, up from 650 a year ago. She said AvalonBay has seen a 20% to 30% annual increase in the volume of packages it receives for the past four years." (WSJ)
"Toby Bozzuto, chief executive at Bozzuto Group of Greenbelt, Md., which manages roughly 68,000 apartment units, said staff at one of his apartment complexes spend about three hours each day sorting packages, which are cluttering up his buildings." (WSJ)
Apartment landlords are buying in in a big way and it's evident why. The time and monetary savings of their staff allows them to handle other issues and takes the headache out of the e-commerce industry that is growing exponentially year over year.
Additional Amazon Supply Chain Innovations
Over the past 10 - 20 years, Amazon has evolved into a logistical chain giant with uncanny abilities to see into the future and predict what users want and need before we know it ourselves. Here are six additional advancements that Amazon has recently innovated to revolutionize the way our entire market thinks and works (SoftwareAdvice).
- One-Hour deliveries with Amazon Prime (in select markets, but growing, also for groceries - see Whole Foods)
- Drones for deliveries (within radius of distribution centres and low weight)
- Dash buttons (to allow for immediate ordering of common household staples)
- Insourcing Distribution (to allow for same day and one-hour deliveries, they use their own fleet)
- Amazon Basics Manufacturing (in house manufacturing of common household items, for cheaper)
- Amazon Robotics (for automated robotics to pick, pack and ship within warehouses, without humans) - check out the video below!