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posted by janrinok on Tuesday July 05 2022, @08:14PM   Printer-friendly

Amazon Cancels Or Delays Plans For At Least 16 Warehouses This Year:

After spending billions doubling the size of its fulfillment network during the pandemic, Amazon finds itself in a perilous position.

In the first quarter of 2022, the e-commerce giant reported a $3.8 billion net loss after raking in an $8.1 billion profit in Q1 2021. That includes $6 billion in added costs — the bulk of which can be traced back to that same fulfillment network.

Amazon (NASDAQ: AMZN) CFO Brian Olsavsky said the company chose to expand its warehouse network based on "the high end of a very volatile demand outlook." So far this year, though, it has shut down or delayed plans for at least 16 scheduled facilities.

"We currently have some excess capacity in the network that we need to grow into," Olsavsky told investors on Amazon's Q1 2022 earnings call. "So, we've brought down our build expectations. Note again that many of the build decisions were made 18 to 24 months ago, so there are limitations on what we can adjust midyear."

[...] If you're wondering how that's possible, consider Amazon's unmatched turnover rate. A New York Times investigation uncovered that even before the pandemic, it was as high as 150%. That means there are more employees leaving Amazon warehouses each year than there are being hired.

[Ed's Comment: AC Friendly withdrawn. You can blame you-know-who for the spamming]

In fact, there has been so much turnover that Amazon began tracking it weekly and found it loses an estimated 3% of its warehouse workers every seven days. That means the e-commerce powerhouse sifts through its entire supply of warehouse labor every eight months on average.

Simply put, the strategy isn't sustainable long term. Still, Wulfraat believes Amazon can weather the storm.

"It will take some time to iron out the wrinkles, but they will get through it," he told Supply Chain Dive.


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  • (Score: 0) by Anonymous Coward on Wednesday July 06 2022, @12:56PM (6 children)

    by Anonymous Coward on Wednesday July 06 2022, @12:56PM (#1258503)

    Right now politicians are trying to solve the labor pool size problem by making it easier for people to immigrate here. The logical solution would be for employers to simply pay more and provide better working conditions as there's a bunch of people that have given up.

  • (Score: 3, Touché) by Opportunist on Wednesday July 06 2022, @02:04PM

    by Opportunist (5545) on Wednesday July 06 2022, @02:04PM (#1258511)

    Given up, or just given up on certain employers and industries?

  • (Score: 0) by Anonymous Coward on Wednesday July 06 2022, @08:47PM (4 children)

    by Anonymous Coward on Wednesday July 06 2022, @08:47PM (#1258561)

    Right now politicians are trying to solve the labor pool size problem by making it easier for people to immigrate here.

    So what is this "here"?

    US? -- then citation needed. US is rather closed to immigrants
    Japan? -- even more closed
    EU? -- nope
    Canada? -- maybe, but not really. The numbers are fixed for a decade+

    • (Score: 1, Informative) by Anonymous Coward on Wednesday July 06 2022, @10:27PM

      by Anonymous Coward on Wednesday July 06 2022, @10:27PM (#1258578)

      All of those countries are trying hard to bring in immigrants. The real issue is that you have to be the right kind of immigrant with the right type of visa. Then, and only then, are they more than happy to take you.

    • (Score: 3, Informative) by ChrisMaple on Thursday July 07 2022, @01:08AM (2 children)

      by ChrisMaple (6964) on Thursday July 07 2022, @01:08AM (#1258599)

      The law says that immigration into the U.S. is limited. The current administration, acting illegally, is not trying very hard to capture people entering the country illegally, and those that are captured are almost all released on a promise (seldom fulfilled) that they'll return at a specified date for a hearing. Included among those released are people already convicted of multiple murders.

      • (Score: 0) by Anonymous Coward on Thursday July 07 2022, @05:48AM

        by Anonymous Coward on Thursday July 07 2022, @05:48AM (#1258632)

        Yes there is a limit to the total number of immigrants that can come in to the US a year (subject to a caveat). But there are drastic differences between the different visa categories. Not all visas take from the same pool. Some visas and nationalities have different priorities in their pool than others that share that pool. And some of immigration categories actually unlimited, such as people who work for the US government, religious ministers, spouses/parents of citizens, etc. Additionally, there is the gaping loophole of using non-immigrant visas or dual-intent to come to the US because they aren't really immigrating on paper.If you are the right kind of immigrant, you can come in tomorrow. If you are the wrong kind of immigrant, you should have known to file in 1997: https://travel.state.gov/content/travel/en/legal/visa-law0/visa-bulletin/2022/visa-bulletin-for-july-2022.html [state.gov]

      • (Score: 0) by Anonymous Coward on Friday July 08 2022, @12:23AM

        by Anonymous Coward on Friday July 08 2022, @12:23AM (#1258788)

        Turn off Fox buddy.