Last-minute shoppers can find a little holiday joy in reports that retailers have increased their shipping speeds this season.
Investments made in improving distribution schemes have paid off for major U.S. retailers, such as Amazon, Walmart, and Target. They have been putting up faster and faster shipping and delivery speeds, much to the delight of their customers.
“Psychologically, fast delivery is very important to the consumer when ordering online,” explained Neil Saunders, managing director of GlobalData Retail, according to The Associated Press. “That is why everyone is trying to push out more into this space even though it’s very expensive to support and it often requires a lot of new infrastructure.”
Seattle-based Amazon overhauled its distribution model so that eight regional warehouses mainly serve local customers rather than shipping items nationwide. According to the e-commerce giant’s CEO, Andy Jassy, this new scheme has paid off.
“We remain on pace to deliver the fastest delivery speeds for Prime customers in our 29-year history,” Jassy said, per the AP.
This likely contributed to the company’s considerable boost in net sales, with the third quarter of 2023 seeing a 13% increase year over year while operating cash flow rose by 81%, as previously covered in The Dallas Express. Moreover, net income rose from $2.9 billion in Q3 2022 to $9.9 billion in Q3 2023.
While Amazon aims to keep a competitive edge over low-cost Chinese retailers Shein and Temu, Walmart, and Target have strived to match Amazon’s shipping and delivery speeds. This year, the two big-box retailers have invested considerable capital in new fulfillment centers and warehouse upgrades.
Above all, Arkansas-based Walmart has focused on automating its processes at its 42 regional distribution centers, with three of these “new generation” facilities opening this year alone — including in North Texas. As previously covered in The Dallas Express, a 1.5-million-square-foot center opened just 15 miles south of Dallas on Belt Line Road in Lancaster this fall. Automation whittles the 12-step order fulfillment process into five steps: unload, receive, pick, pack, and ship.
Minnesota-based Target has plans to pour $100 million into improving its shipping and delivery services from its regional warehouses, referred to as sortation centers. It currently operates 10 but aims to grow to 15 by early 2026 to continue boosting its delivery volume and same-day delivery offerings.
“These facilities have transformed how we move inventory with speed and precision to guests’ doorsteps,” explained John Mulligan, Target’s executive vice president and chief operations officer, according to the AP.
Anyone looking to order some last-minute gifts might want to check out these shipping tips from delivery service providers, as previously reported in The Dallas Express.
