Amazon’s fulfillment services, particularly Fulfillment by Amazon (FBA), are renowned for their efficiency and extensive network. Here’s how Amazon compares to other major retailers in terms of fulfillment:
Amazon operates over 185 fulfillment centers globally, with more than 100 in the US alone. This vast network allows Amazon to deliver products quickly, often within two to three days, thanks to its strategic locations and advanced logistics systems. Amazon’s fulfillment fees start at $3.22 per unit, which is slightly lower than Walmart’s starting fee of $3.45 per unit. Additionally, Amazon offers incentives like reduced fees for certain products, such as a recent reduction in inbound placement service fees for large items.
In contrast, Walmart’s fulfillment services focus on leveraging its physical store network, with 31 dedicated fulfillment centers and 210 distribution centers in the US. Walmart’s model allows for easier returns and pickups at physical stores, which can be advantageous for customers in rural areas. However, Walmart requires products to be shipped from within the US, limiting international suppliers.
Target, another major retailer, primarily uses its 1,931 physical stores as fulfillment centers for online orders, rather than dedicated warehouses. This approach allows Target to utilize existing infrastructure but may not offer the same level of logistical efficiency as Amazon’s dedicated fulfillment centers.
Amazon’s logistics network is also supported by over 3,000 Delivery Service Providers (DSPs) and 275,000 drivers, delivering more than 10 million packages daily. This extensive network contributes to Amazon’s significant market share in parcel delivery, with 27% of the U.S. market.
Overall, Amazon’s fulfillment capabilities are highly developed, offering a wide reach and fast delivery times, which are key factors in its success as an online marketplace.