How Amazon Prepares For The Holiday Delivery Rush
He may not have a sleigh and reindeer, but with billions of Amazon packages delivered during the holiday season, Jeff Bezos' company has become the 21st century Santa Claus.
Instead of a workshop in the North Pole, Amazon's magic happens in its more than 80 fulfillment centers worldwide, where hundreds of thousands of employees and robots, not elves, work around the clock to sort and deliver a staggering number of gifts.
During last year's holiday season, more than a billion packages were sent using Amazon Prime. Multiple fulfillment centers, including ones in San Marcos, Texas, and Kent, Washington, had single days when they shipped more than 1 million products. For comparison, fulfillment centers typically ship about 40,000 items on non-holiday-season days.
Delivering that many packages requires a herculean effort, and the company packs its warehouses with new employees to meet the task. For the 2017 holidays, Amazon announced it would hire 120,000 seasonal associates, nearly doubling its full-time fulfillment center staff of 125,000.
The fulfillment center staff work for 20 hours out of the day, Amazon spokesperson Ashley Robinson said. Each associate works four 10-hour shifts in a week, but they can work overtime hours during the holiday season. Building maintenance staff clean and fix equipment during the four hours when the fulfillment center is not running, so the buildings are never completely quiet.
Amazon has more than 75 fulfillment centers across North America, with at least 30 more in the works. It also has more than 25 sorting centers, smaller warehouses that help with last-mile delivery near population centers. During other parts of the year, some of the stations at fulfillment centers remain empty, but during the holiday season they are all full.
“The building is filled up quite a bit more,” Robinson said. “There are a lot more trucks coming in and out. It’s our normal [process] but at maximum.”
Inside the centers, humans and robots team up to move products from place to place in a fast-moving environment. Small, circular, orange robots wheel around on the floor carrying shelving units. The 350-pound robots can lift twice their weight. This allows the warehouses to hold more inventory because they can fit shelves closer together without walkways.
The robot brings the shelving units to the workers, who take items off the shelves, pack them into boxes and load them onto the trucks. When the shelves are empty, workers fill them with items from a plastic yellow bin, which they call totes. To make the process more efficient, workers fill the shelves randomly, jamming items in based on shape like a game of Tetris.
"The reason everything is randomly stowed is to decrease walking and fulfillment shipping times," Robinson said. "If you're in a store and you've got a list of things to purchase, you walk to the produce, dairy and junk food aisles. That's a lot of walking. If it were all randomly jumbled together, you would not have to walk quite as far."
The peak season lasts about a month, but Amazon is thinking about it all year long. The company gets to work on Jan. 1 to begin preparing its staffing effort for the holiday season, Robinson said.
In late September, the company begins what it calls inbound peak. This is when it starts getting its holiday season inventory from vendors. It brings products into the fulfillment centers on trucks, stores them in shelving units and conducts quality control checks.
The five-day surge between Thanksgiving, Black Friday and Cyber Monday, which Amazon has coined the "Turkey 5," kicks off the holiday delivery madness. But they are not the busiest days for Amazon deliveries. The number of packages the company ships continues to increase as Christmas approaches, and last year its worldwide delivery peak was Dec. 19.
The National Retail Federation projects consumers will spend $679B between retail and online holiday shopping during November and December, a 4% increase from last year. An NRF survey found an estimated 164 million Americans — 69% of the country's population — are planning to shop or are considering shopping over Thanksgiving weekend.
Amazon's same-day delivery service, Prime Now, allows procrastinators to order gift deliveries as late as Christmas Eve and have them under the tree in the morning. The busiest day ever for Prime Now was Dec. 23, 2016, with three times more deliveries than the same day the year before. The fastest Prime Now delivery, according to Amazon, came in 13 minutes when a customer in Redondo Beach, California, ordered a Tile item finder.
Fulfillment centers typically get their last order out the door at noon on Christmas Eve, Robinson said. Workers then leave in time to celebrate the holiday, when they finally get to open some of the boxes they spent the last several weeks packaging and sending out.