(PresidentialInsider.com)- According to Bloomberg, Amazon has stopped building more than 40 warehouses, totaling approximately 25 million square feet of space.
Bloomberg cited the information from the supply chain consulting firm MWPVL, which carefully monitors Amazon’s operations. Andy Jassy, the CEO of Amazon, has devised a plan to reduce an apparent surplus of warehouses and staff after a spending spree during the pandemic. Following a period of fast growth during the epidemic, during which Amazon, for a time, built a new warehouse virtually every day, Bloomberg claimed that Amazon had now canceled, stopped, or postponed 60 warehouses and laid off 100,000 workers.
According to Marc Wulfraat, founder and president of MWPVL, there is some substantial downsizing before year-end – in North America and the rest of the world. Despite this, they continued to open additional facilities at an incredible rate this year.
As inflation continues to hover around record-high levels, Amazon is joined by other struggling businesses in having to lower their earnings projections. According to the Bureau of Economic Analysis, consumer spending and the nation’s gross domestic product modestly decreased in the second quarter.
Amazon said this week that it plans to close two delivery stations near Baltimore that employ more than 300 people but emphasized that the staff members would be able to transfer to other facilities. To prepare for the holiday shopping season, Amazon would ordinarily be opening additional facilities or employing personnel.
An Amazon representative told Bloomberg that the Baltimore-area facilities were closing as part of modernization efforts, adding that the business frequently looked at numerous locations and altered plans “depending on needs across the network.”
In response to this decline in warehousing capacity, Amazon unveiled its new Amazon Warehousing and Distribution (AWD) service, enabling suppliers to utilize the Amazon warehouse system to store merchandise.
According to the announcement, Amazon Warehousing & Distribution (AWD) addresses crucial supply chain concerns and helps sellers expand and manage their businesses while substantially decreasing expenses. Sellers are freed from the laborious, time-consuming process of transporting merchandise from upstream facilities to Amazon fulfillment centers thanks to this straightforward pay-as-you-go service. AWD was created primarily to address the problems associated with inventory management and to provide operational efficiency, bringing the promise of the supply chain as a service to reality.
The Wall Street Journal reports that the announcement comes in the wake of recent` struggles in the retail sector to eliminate excess inventory, with many businesses substituting trucks, shipping containers, and other unconventional warehouse methods as consumers’ discretionary incomes are threatened by inflation.
According to MWPVL, Amazon presently has 520 primary package delivery stations across the United States and still has plans to add 150 more.