According to foreign media CNBC, Amazon’s warehouse statistics are facing new adjustments, and the company is considering calculating the size of the warehouse in cubic feet instead of the original square feet.
Recently, Amazon CFO Brian Olsavsky said in a conference call that the company began to consider the use of cubic feet as the “main indicator” to measure the size of its warehouse. This will make it clearer that as inventory grows, Amazon is becoming more efficient.
Brian Olsavsky said: “If the company makes adjustments, it will provide investors with more details, but he did not disclose when Amazon will make a decision.”
Amazon multi-storey warehouses use robots to retrieve inventory. With the use of robots, more and more items are being placed in distribution centers, and toiletries, electronics, and household items are placed on high shelves for storage and retrieval.
As of now, Amazon expects its warehouse area to grow by 15% by 2018, down from 30% in the previous two years. By the end of 2017, Amazon had nearly 200 million square feet of space in its warehouses and data centers.
Amazon is moving in the direction of vertical expansion, filling up multi-storey warehouses, which is especially important in densely populated urban areas. Therefore, its actual use of the warehouse no longer only shows the length multiplied by the width, but takes into account the range of heights.
Suvrat Dhanorkar, professor of supply chain management at Penn State University, said: “Amazon is becoming more efficient in its use of warehouse space.”
The surge in online shopping has led retailers to look for more storage. According to a recent report, demand for industrial real estate comes mainly from e-commerce warehouses and distribution centers, which have exceeded supply for 34 consecutive quarters.
Industry insiders believe that multi-tiered warehouses are particularly useful for Amazon and other companies that want to be close to the city, improving customer delivery efficiency. This strategic move is critical to Amazon because they want to solve the last mile problem.