Amazon Expands Last Mile Network to Offer 2-Hour Deliveries From Rite Aid Stores
It is expanding its use of last-mile logistics for pickup, delivery service.
Amazon continues to expand the use of its last-mile logistics network as a pure pickup-and-delivery service for 3rd party shippers, increasingly positioning itself as a pure shipping alternative to UPS and FedEx.
The e-retail giant has launched two-hour delivery from a select group of Rite Aid stores to its Amazon Prime members. The service the pharmacy chain delivery service is launching this month in Newark, NJ and Burbank, CA, Supply Chain Dive reported.
Amazon said it would delivery sundries from Rite Aid stores including health and personal care items, groceries and cosmetics, with one important caveat: it won’t be delivering prescriptions or other pharmaceuticals from the drug stores.
An Amazon spokesperson said in a statement the delivery service will expand to include other Rite Aid locations; the chain encompasses 2,200 stores in 17 states.
Amazon increasingly has been leveraging its on-demand, same-day “flex” delivery network to service third-party sellers, offering two-hour deliveries from West Coast chains Bristol Farms and Pet Food Express, as well as Bartell Drugs, Cardenas Markets and Save Mart.
In August, Amazon launched same-day delivery service for retailers PacSun, GNC, SuperDry and Diesel in 10 metro markets including Atlanta, Dallas, Chicago, Las Vegas, Miami Phoenix and Seattle.
The option is limited to select items and is free to Prime members as long as they spend at least $25; for orders below $25, the service costs $2.99.
For the past 12 months, Amazon has been trimming its overextended logistics network in a cost-cutting binge that has seen it close, cancel or delay the opening of 99 facilities encompassing more than 32M SF in 30 states, according to MWPVL International, a logistics consultant that tracks Amazon’s network.
The lion’s share of the closed facilities is located along the Boston—Washington DC corridor and in California, Florida and the Chicago metro. Fulfillment centers and last-mile delivery stations are the facility types most impacted by the closures, according to MWPVL.
According to MWPVL data, despite its across-the-board effort to trim warehouse space, Amazon still has an estimated 231 facilities encompassing 82M SF in the planning stages, most of which were earmarked for an expansion of its last-mile delivery reach that was planned before the cost-cutting began in Q2 2022.
While delaying the opening fulfillment centers, including newly built multi-story mega-warehouses—which will stand empty for up to two years—Amazon has yet to establish a strategy for final-mile delivery stations that are nearing completion, MWPVL said.
According to the report, the company is alternating between opening delivery stations in new markets or immediately listing new delivery facilities for sublease in established markets.