Last month, Amazon announced that it would be seeking to bring one-day delivery to Prime users in the U.S., down from the two-day deliveries it offers now. It hopes to deliver this change by over several quarters but insights from RBC Capital Markets suggests that Amazon’s network is already capable of delivering items on the same day or a day later to 72% of the total U.S. population.
Once you focus in on the top 16 most populated states and Washington D.C., the 72% figure climbs to 95%. In order to set up the network to meet the quick delivery times, Amazon will be investing $800 million.
According to RBC Capital Markets, via CNBC, Amazon’s push will further increase it’s already existing dominance in the online retail space, saying:
“While store-level distribution is still the fastest way for a consumer to acquire a product, Amazon’s continued rollout of same-day and next-day delivery capabilities continues to reduce that historical competitive barrier and represents a growing risk to retailers who are too often fighting yesterday’s (2-day) delivery wars.”
Amazon still has some work ahead of it, in ten states including Michigan (2.2% of household) and Iowa (3.1% of households), less than half of the households are covered by same-day or 1-day Amazon deliveries so the e-commerce giant will definitely have to focus its resources in these areas as it pushes for its goal.
Source: CNBC