Ready for Amazon to get even more ubiquitous in your day to day life? The e-commerce giant is planning on opening 1,000 to 1,500 small distribution hubs in suburban areas across the country, Bloomberg reported on Wednesday, in part spurred by major delays in shipping during the novel coronavirus pandemic.
The e-commerce company saw extensive delays in shipping earlier this year, in some cases as long as a month, as it switched to prioritize high-demand essential goods. Amazon has sought to keep up by hiring hundreds of thousands of workers, and according to Bloomberg, it also wants to creep its malign tendrils further into neighborhoods across the country by installing smaller delivery centers in close proximity to endpoints.
Amazon has usually built or leased out massive, warehouse-style distribution centers that aren’t located right in the middle of population centers. “Small, quick-delivery warehouses,” as Bloomberg put it, would essentially make Amazon much more of a direct competitor to UPS and the ailing U.S. Postal Service (which is facing massive backlogs and devastating cuts by postmaster Louis DeJoy, the Trump administration’s hatchet man). It would also push back against retail chains like Walmart which have begun to compete more directly with Amazon in e-commerce and already use ubiquitous stores as online fulfillment centers.
Amazon declined to comment on the plans to Bloomberg, but it did highlight the growth of its “last-mile delivery network,” which in Amazon’s case is powered by armies of underpaid contractors with few labor protections:
The company declined to comment on the expansion plans, but has said its last-mile delivery efforts are meant to supplement, not replace, its long-time partners. “Our dedicated last-mile delivery network just delivered its 10 billionth package since launching over five years ago, and we’re proud to provide a great service for our customers,” a spokeswoman said.
Bloomberg wrote that Amazon may choose to assimilate real estate made available by retailers who it has helped drive out of business or otherwise shuttered during the coronavirus pandemic. The news agency’s sources said that was a “last resort” plan, but that Amazon was more likely to raze the buildings to the ground and start anew than try and convert malls into warehouses:
… That option is only a last resort, said the people privy to the company’s plans, who requested anonymity to discuss an internal matter.
Department stores such as J.C. Penney are often two stories and lack sufficient loading capacity, they said, meaning they require extensive remodeling to accommodate an Amazon delivery hub. Moreover, mall leases with existing tenants often prohibit the owner from introducing a delivery hub that could spoil the shopping experience, and city officials might not quickly approve an industrial use in a retail area. It’s more likely that dead malls will be bulldozed to make way for an Amazon warehouse, as they have in the Midwest, than for an Amazon delivery station to sprout in a half-vacant mall to coexist with Kay Jewelers and Cinnabon.
Kearny, New Jersey Mayor Alberto Santos told the news agency he had noticed a “weird gentrification effect” in which Amazon “[keeps] picking up sites, which drives up prices for everyone else.” That in turn drives warehouses belonging to small businesses further from residential areas, Santos said.
“Regulation is definitely flat-footed right now,” University of Oregon architecture professor and urban land use expert Nico Larco told Bloomberg. “The warehouse doesn’t want to be tucked away in an industrial district any more. It wants to be right next to you. But when these things come to our neighborhoods, they’re unsightly.”