Warehouse Industry Growing because of Same-Day Delivery

Warehousing is what retailers have come to grips as a vital part of having success with Same-Day Delivery. This is something Amazon had in mind when it strategically planted state-of-the-art order fulfillment centers throughout the US. As a result, the e-retail leader is driving a trend online with fast delivery that must have close proximity warehousing to work. Now, more retailers are renting warehouse space and the numbers show it.

Retail Dive reported via Bloomberg that online retail is now accounting for 20% of warehouse space. Also, the renting of prime warehouse space in the US rose 9.9% last year. It pointed out six markets that were among the nine with the biggest increases worldwide. Oakland topped the increases with 29.8%, which was seen also in Northern New Jersey, according to real-estate brokerage firm CBRE.

David Egan, CBRE’s head of industrial and logistics research for the Americas, told the Wall Street Journal earlier this month, “There are huge premiums being placed right now on being close to the consumer—speed of service, speed of delivery is a critical component of why people choose to buy from one retailer over another. To get the goods to consumers fast, you have to get close to them.”

Amazon is driving the surge in warehousing within the retail industry resulting from same-day delivery expansion. The retailer leader launched 11 more major US cities to its' free same-day delivery program. Those new cities included Sacramento, Stockton, Charlotte, Cincinnati, Fresno, Louisville, Tucson, Milwaukee, Nashville, Raleigh, and Richmond. With a total of 27 service cities, Amazon is on pace to eventually provide same-day delivery nationwide, solely enabled by its distribution systems and warehousing.

Centrally-located warehousing won't due when it comes to same-day delivery. This use to be the model for distribution until the weigh in of e-commerce and the ability to scale operations fast. Online retail is projected to reach $500 billion by 2018, which means there will be a heavy emphasis on how close can a retailer get their products to customer markets. Brick-and-mortar retailers use their store locations as warehouses and partner with a Same-Day Courier like A-1 Express to fulfill online order deliveries. With a New Jersey Courier that has a national footprint and leading courier technology like this, it helps retailers create the competitive advantage they need.

When demand spikes upward in specific markets, a retailer can quickly implement a same-day delivery solution there. With last-mile deliveries, just having a solid warehousing system in place isn't enough. It has to be coupled with online order fulfillment supply chain to get customer purchases to their front door. Indeed, same-day delivery is expected to reach $987 million by 2019, which will result in the inevitable growth to be seized by a company. The one with the right delivery outfit will be the one that keeps the business. Google, Amazon, Whole Foods, Macy's, and more have jumped into offering a fast delivery option and others should do the same.

Reference: 5.25.16, www.retaildive.com,Daphne Howland, Report: E-commerce growth driving rush for warehouse space

Amazon Expands Same-Day Delivery to All Service Area Zip Codes

There has been recent speculation that minorities have not been treated equally relative to Amazon offering Same-Day Delivery in certain service area zip codes. To stamp out any allegations, Amazon has decided to fix it.

Bloomberg recently reported that Amazon has announced that it will now offer same-day delivery in every zip code within its' service areas. The largest e-retailer in the US has been expanding its' same-day delivery program rapidly in various US markets. It provides the service free to Prime members, which pay a $99 subscription cost per year. This issue arose last month, as the service was being offered in certain areas in Boston, yet not in Roxbury, which was in the center of the city. Service boundaries by Amazon were said to not have to do with race, but rather other factors, such as the concentration of Prime members in each area, proximity to warehouses and the company’s ability to find delivery partners to serve that area.

Amazon made a statement obtained by the caucus and shared it with Bloomberg News, which said, "Very shortly, we will be expanding Prime Same Day Service to every zip code of the 27 cities where Prime Same Day delivery is currently launched. We will further not launch the service in any new regions, until we are able to secure a carrier for every zip code. We are still figuring out the details and procuring last mile delivery for each of these zips, but we should have 100 percent coverage shortly."

It was also mentioned in the article that U.S. Representative George Kenneth Butterfield, a Democrat from North Carolina and chairman of the black caucus, said the group "is anticipating the results of Amazon’s plan to expand its delivery services to previously excluded zip codes." Illinois Congressman Bobby Rush called for an FTC investigation, in addition to speaking about the issue on the House of Representatives' floor. Shortly afterwards, Amazon pledged in a letter to Rush to serve Chicago’s South Side in within weeks.

Same-day delivery is forecasted to reach $987 million by 2019, and it seems that Amazon knows its' potential. Last month, Amazon adding 11 major US cities to its' current free same-day delivery program. Those new cities included Sacramento, Stockton, Charlotte, Cincinnati, Fresno, Louisville, Tucson, Milwaukee, Nashville, Raleigh, and Richmond. This brought its' total service areas to 27 cities so far, and more than likely, the retailer is far from being done. Many experts believe Amazon's goal is offer free same-day delivery nationwide.

As Amazon continues to outpace its competition, other retailers are implementing same-day delivery in order to keep up. A Same-Day Courier like A-1 Express can partner with any business or retailer to successfully develop last-mile deliveries through the US. The Chicago Courier has the courier expertise, technology and nationwide footprint to perform same-day delivery in various service areas and zip codes. Taking Amazon seriously by engaging in same-day delivery is the wisest move for any big name retailer to make.

Reference: 5.6.16, Bloomberg News, Spencer Soper, Amazon to Fill All Racial Gaps in Same-Day Delivery Service

Shopify Now offers Same-Day Delivery

So many retailers are after implementing Same-Day Delivery to fulfill online orders. It's a fast shipping option that retail leaders like Amazon, Google, Macy's, BestBuy, and more have all invested into making it a staple service. Online storefront software provider Shopify says it sees the potential of last-mile services, and now itsmerchants will have the opportunity provide same-day delivery.

Shopify recently discussed in a blog that it has partnered with Postmates to offer a same-day delivery in around 200 cities nationwide. The cities were not named, yet more than likely, they will be those in which Postmates already supplies the service. It was indicated that Postmates' current coverage area will expand also. This will result in more markets that Shopify's merchant customers can establish same-day options. Postmates is also looking to set up services in Europe, beginning in the UK.

The new service Shopify says will help its customers to be able to get their online products picked up and delivered as little as within an hour. This is becoming a standard option for most big name retailers that offer same-day delivery. There is a segment of the end customer market that want it fast, and Shopify is entrusting Postmates to help make it consistently happen. Same-day delivery is expected to reach $987 million by 2019, therefore, demand for the service will grow.

Its merchants were offered $50 in free Postmates deliveries through May 3rd and 5th last week. With the volume of clients that Shopify has, it makes sense to turn to same-day delivery to boost revenue. The e-commerce provider gains more than 100,000 e-retail clients annually. This mean you have an array of e-retailers with thousands of online products that are seeking to increase sales.

One of the big reasons why more and more companies are going same-day delivery is because the largest e-retailer in the world is driving it. Amazon announced last month that it was adding 11 more major US cities to its' current free same-day delivery program. Those new cities included Sacramento, Stockton, Charlotte, Cincinnati, Fresno, Louisville, Tucson, Milwaukee, Nashville, Raleigh, and Richmond. This adds to the 17 cities that Amazon had before the expansion. Now with 27 total cities where the retailer offers free same-day delivery, Amazon's goal is clear to take the service nationwide.

As Shopify did with Postmates, many retailers are partnering with a Same-Day Courier like A-1 Express to expand market share online. The Pittsburgh Courier is viable option to partner with for same-day logistic solutions. With a nationwide footprint, A-1 Express can help any online merchant be successful with last-mile deliveries.

Reference: 5.3.16, www.shopify.com, Shawn French, Now Shopify Merchants Can Offer Their Customers Same-day Delivery Through Postmates

Can Fast Delivery Help Target & Wal-Mart Catch Amazon Baby Goods Sales?

Without question in the online retail market, baby goods is the product category that is soaring above all others. It currently has very impressive numbers in regards to sales, and the retailer that is capitalizing on it is no other than Amazon. Between the e-retail leader, Wal-Mart and Target, Amazon has the highest share of the market. One reason Amazon does could very well have to do with free Same-Day Delivery in several major US cities. The question remains will Target and Wal-Mart go deeper into last-mile deliveries to compete with Amazon.

The baby products category has the highest penetration of sales online, and 75% of those sales occur on Amazon.com, Walmart.com and Target.com. Internet Retailer discussed in a recent article how consumer research firm TABS Analytics' new study showed that e-commerce accounts for 20% of all sales in the baby products market, which totals $30 billion per year. This outstrips the 2% penetration for all other consumer packaged goods. Consumers that shop for baby goods online need them frequently, and the value-added service of convenience that same-day delivery brings could increase sales. This is why it is going to be interesting to see if Wal-Mart and Target beef up their same-day services as Amazon has done.

“Online sales of baby products are out-competing all other segments of consumer packaged goods that we have surveyed over the last three years,” said TABS Analytics CEO Kurt Jetta in the article. “Brick-and-mortar retailers with e-commerce aspirations should treat baby product sales as the frontline of their battle for online success.” Online retail is forecasted to reach $500 billion by 2018, which means baby goods will be among the online products that grows even more than it has. Wal-Mart and Target could potentially develop more same-day delivery throughout the US to compete with Amazon. One thing we can be certain of, Amazon sees the value in the trending service option and will not be slowing down same-day delivery for no one.

The numbers show indeed that Amazon has a larger percentage of the baby goods market online. The study also shows that 18%-24% of baby products purchases occur online. That means that Amazon/Diapers.com represents 43% of the baby products market online. Wal-Mart’s represents 23% and Target's is at 18%. All other e-commerce players roughly coves the remaining 12% of the market. The article also mentioned that Amazon with it's subsidiary Diapers.com, comprises 7.3%-10.6% of all baby products purchases nationwide. Walmart.com accounts for 3.7%-5.8% of purchases and Target.com represents 3.3%-4.3%.

Based on the TABS survey of 2,000 consumers between the ages of 18-75, some additional findings in the article stated:

• Households with children up to 5 years old are the heaviest buyers, accounting for 60%-70% of all purchases online and offline.
• Households with young children purchase 8.5 baby product types per year, compared to 1.6 for all other buyers.
• Roughly 40% of baby products are purchased by consumers who don’t have any young children in their households, which represents 71% of all households. The bulk of these purchases likely come from relatives or friends giving gifts.

Wal-Mart and Target already are engaged in some level of same-day delivery. A Same-Day Courier like A-1 Express can partner with the retailers to create a same-day delivery program for hundreds of stores. The San Francisco Courier is a nationwide courier and has the expertise it takes to consistently fulfill orders for baby goods online.

Reference: 4.20.16, www.internetretailer.com, Stefany Zaroban, Amazon, Target and Wal-Mart battle for online sales of baby goods

Roxbury Prime Members Want Amazon's Free Same-Day Delivery

It takes a big retailer with all the right pieces to successfully implement Same-Day Delivery in major US cities, not to mention being capable to offer it free. No other than Amazon has cracked the code and is moving at a fast pace, adding one market area after another. Before long, the e-retailer is going to be providing free same-day delivery nationwide.

Yet, there is one area in Boston full of Prime subscribers inquiring why same-day delivery hasn't come their way. The Boston Globe reported that Amazon offers free same-day delivery in every Boston neighborhood--except Roxbury. One of the findings by Bloomberg compared US census data that showed that minority neighborhoods in several cities have not been included to offer free same-day delivery. Roxbury is 59% African-American and is the "most striking gap" found from the data. The retailer's service stretches from Boston city limits to many suburbs and nearby communities, but for some reason, not in Roxbury.

The article stated that per Amazon to Bloomberg, Roxbury’s circumstance is “an anomaly" and nothing else. Amazon gave Mattapan as a example, which is 85% African-American, as well as nearby majority-minority communities like Lawrence and Chelsea. There are no demographics that play a role in deciding where it delivers same-day. “Yet in cities where most of those paying members are concentrated in predominantly white parts of town, a solely data-driven calculation that looks at numbers instead of people can reinforce long-entrenched inequality in access to retail services,” said Bloomberg writers. Amazon spokesman Scott Stanzel responded in a statement, “We will continue expanding our delivery capabilities and are adding more zip codes rapidly”. Either way, the free same-day service is popular and Roxbury Prime members want it available in their city.

For orders $35 and over, Prime members are able to receive same-day delivery free. This is very impressive, as well as attractive for shoppers that probably order from Amazon regularly above the threshold. They also pay a $99 annual fee to be a Prime member, which also includes Amazon's two-day free shipping as well. Prime is what Amazon is pushing more than ever, as the e-retailer increased the free two-day shipping threshold from $35 to $49 to qualify for free two-day shipping for Non-Prime members in hopes to convert them into annual subscribers.

Amazon has been expanding free same-day delivery throughout this year, adding 11 more major US cities to its' free same-day delivery program, which included Sacramento, Stockton, Fresno, Cincinnati, Louisville, Raleigh, Nashville, and others. Boston was among the first large implementation of Amazon's free same-day delivery last year, which consisted of San Francisco Bay Area, Seattle-Tacoma, Dallas-Fort Worth, San Diego, Phoenix, Indianapolis, Tampa Bay, Baltimore, New York, Philadelphia, Chicago, Washington DC, Orlando, and Atlanta. Amazon's free service is now in 27 major cities and more are likely to come.

Whether in Roxbury or not, it's clear that Amazon is being relentless in its' pursuit to offering same-day delivery nationwide and other retailers are turning toward offering it also. A Same-Day Courier like A-1 Express is a provider that retailers want to team up with to quickly implement an effective same-day delivery model. The Boston Courier can develop same-day solutions nationwide and generate the market share online that companies are looking for.

Reference: 4.22.16, www.boston.com, Trefis Team, Adam Vaccaro and Allison Pohle,Amazon offers same-day delivery to every Boston neighborhood, except Roxbury