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- Amazon's one-day delivery has returned to availability for more products, according to DataHawk, a research firm that specializes in Amazon's marketplace.
- Over 25% of the products sold on Amazon are now shipped within one day, while almost 50% of the products are delivered within two days, according to DataHawk.
- That's a huge improvement from May, when only 3% of the products were shipped within a day.
- The change shows Amazon's supply chain is quickly recovering from the COVID-driven demand that put strains across its logistics network.
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Amazon's effort to roll out one-day shipping is back on its feet after having experienced massive shipment delays during the pandemic.
More than 25% of the products sold on Amazon are now shipped within a day, according to new data provided by DataHawk, a research firm that specializes in Amazon's marketplace. Almost 50% of the products are delivered in two days, and over 95% of all products are shipped in less than two weeks, it said. The data is based on 40,000 products tracked by DataHawk's analytics software.
That's a huge improvement from three months ago, when over 50% of the products took six days or more to get delivered, based on DataHawk's data. One-day shipping was largely non-existent in early April, and applied to just 3% of the products even in early May, the data shows.
"This means Amazon's fulfillment capabilities and supply chain is in much better shape," Othmane Sghir, CEO of DataHawk, told Business Insider. "The improvement is massive."
The data shows Amazon's supply chain is quickly recovering from the COVID-driven demand that put a strain across its logistics network. Amazon shoppers saw weeks, if not months, of delays in package deliveries in the early parts of the pandemic, as the company struggled to deal with the unexpected order surge from people sheltered in home.
One-day shipping has been a major area of investment for Amazon since early last year. It spent over $3 billion in rolling out the initiative last year, and an additional $1 billion in the first quarter of this year to make it more widely available. In February, Morgan Stanley estimated that roughly 40% of all products sold in the US were shipped within a day, up from less than 10% in the first quarter of last year. It expects almost half of all products to be one-day-eligible by the end of this year.
Amazon's spokesperson declined to comment on the data, but said the company has improved delivery speeds by adding capacity and safety measures in its storage network, while hiring 175,000 new employees in recent months.
"We know customers want their deliveries as quickly as possible and we will continue to adjust our processes in response to COVID-19 to return to full capacity and normal delivery speeds as quickly as possible," the spokesperson said.'Out of space'
Questions about Amazon's one-day delivery came up repeatedly during the company's earnings call with analysts last week. CFO Brian Olsavsky didn't share many details, only saying the company is "getting progressively better" at one-day shipping. But because of the continued spike in demand — Amazon's second-quarter sales were higher than last year's holiday season for the first time — it's still struggling to balance its shipping capabilities, he said.
"We don't think we're going to be back [to where we were pre-COVID] in the short run, but we will continue to improve," Olsavsky said.
The main challenge for Amazon's one-day delivery effort may have more to do with shipments between warehouses to get products in stock, rather than its ability to ship things quickly to the end consumer.
Multiple sellers told Business Insider that they have struggled to get their inventory shipped to Amazon's warehouses in recent weeks. Some of them complained about weeks of delays in sending in inventory and difficulty in keeping products in stock, as Amazon put in new shipping restrictions at its storage facilities. Groups of sellers made similar complaints on an online seller group called ASGTG.
Olsavsky seemed to confirm some of these issues during last week's earnings call. He said Amazon is working hard to secure enough storage capacity for all the inventory needed for the upcoming holiday shopping season.
"We need to build the inventory more for Q4, and we've run out of space," Olsavsky said.
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