Ecommerce stores warehouse

Amazon Culls 53M SF warehouse footprint

Amazon, which doubled the size of its logistics network at lightning speed during the pandemic to more than 400 million Swiss francs, is now proving that it can roll back almost as quickly as it has grown.

Since revealing earlier this year that he had overestimated the growth rate of e-commerce, resulting in too many warehouses and warehouse workers – and the first quarterly losses for the e-commerce titan since 2015 – Amazon has been busy eliminating its industrial footprint.

The online retail giant has used every space reduction method in its toolbox, including closing warehouses, subletting part of its 370 million square foot leased industrial space, canceling new distribution center projects that have not yet been launched, and delaying the opening of newly constructed warehouses for up to two years.

The reach of this effort has been nothing short of Amazonian: A new report from MWPVL International, which tracks logistics facilities, reports that Amazon has closed or killed plans to open 42 facilities totaling approximately 25 million square feet and delayed the opening of 21 additional facilities totaling 28M SF.

The latest Amazon warehouses to be sliced ​​are in the Baltimore area, where the company notified local authorities last week that its last-mile delivery stations in Hanover and Essex, which employ more than 300 workers, would close next month. .

According to MWPVL, Amazon’s budget cuts aren’t over. “There are still serious cuts [for them] to be done before the end of the year, in North America and the rest of the world,” said Mark Wulfraat, president of MWPVL. Bloomberg.

However, as Amazon continues to inflict economic hardship on communities across the United States with its warehouse closures and delayed openings, MWPVL’s report indicates that the e-commerce giant is choosing its locations by opening spaces warehouse in a few select locations where he thinks the traffic will support full operation.

An Amazon spokesperson said Bloomberg that the e-retailer carries out its industrial space fittings “according to the needs of the network”.

Amazon reported losses of nearly $4 billion in the first quarter of 2022. When it decided to change course and reduce its industrial footprint, which at the start of the year encompassed around 1,200 installations, the company was building up to 10 multi-storey buildings. mega-warehouses at various company locations.

Amazon said it would complete buildings under construction, but delay opening them for up to two years. But many other development projects that have yet to start — Amazon bought around 4,000 acres during the pandemic — were abruptly canceled by the company.

According BloombergAmazon’s workforce, estimated at 1.52 million, shrank by about 100,000 in the second quarter, the largest quarter-over-quarter workforce contraction in the history of the company.