RBC: Amazon Logistics' planned 2020 growth exceeds previous 3 years combined

Amazon's delivery stations, the facilities closest to the consumer, are growing the most as the e-tailer expands its logistics footprint, according to a research note published last week from RBC Capital Markets based on data from the supply chain consultancy MWPVL and Amazon's financials. Amazon delivery stations are growing in number and getting larger, the researchers noted, pointing out this helps Amazon get inventory "dramatically closer to the consumer." Amazon announced its plan in July to increase the square footage of its distribution operation by 50% by the end of 2020. This will result in the company adding three times the amount of capacity it added in 2019 and is more than what the company added over the last three years combined, according to RBC. "In 2019, Amazon had partnered with 800 companies with 75,000 drivers who picked up items across Amazon’s then 150 Delivery Stations," RBC wrote of the growth. "Now, Amazon partners with 1,300 companies that employ 85,000 workers, across what we think are currently approximately 400 Delivery Stations in the U.S." Amazon's effort to get inventory closer to consumers is not exactly new to Amazon, nor as a general supply chain management strategy. Experts have long known that increasing the number of facilities will decrease transportation costs while increasing inventory and facility cost.