The Supply Side: Amazon warehouse in Lowell would expedite local deliveries

Amazon’s plans to operate a delivery station warehouse in Lowell will likely mean faster delivery times for consumers ordering online. The online retail titan is locating the operation in an existing building at 315 S. Lincoln St.

According to permits filed with the Arkansas Department of Environmental Quality in November, the 98,208-square-foot facility was built in 2005 and is equipped with loading docks and paved parking for hundreds of delivery vehicles. Crossland Realty Group filed the permits on behalf of Amazon.com. Permits with the Arkansas Department of Health were also filed for the facility in June by SGA Design Group of Tulsa.

Amazon is calling the facility a “delivery station warehouse,” according to employment ads the company has on Indeed.com. Amazon did not respond to a request for information about the facility, but the ads said it was hiring warehouse workers. Amazon has said the facility would be the last stop before orders go to customers. The operation is slated to open later this spring.

“Our fast-paced, physical roles receive trucks full of orders, then prepare them for delivery. You’ll load conveyor belts and transport and stage deliveries to be picked up by drivers. You may even be part of the team that works with larger items, such as large screen TVs, furniture, and appliances, and be trained on how to use technology to handle these heavy bulk items,” Amazon states on its hiring website.

To get products closer to the end-users, part of Amazon’s strategy has been to add more delivery warehouses. In 2021, Amazon opened several next-day and same-day warehouses in markets like Nashville, Tenn., and Dayton, Ohio.

If the Northwest Arkansas warehouse is a same-day delivery center, Prime customers can order items from fashion to grocery for same-day delivery. The closest Amazon Hub warehouse to Northwest Arkansas is an hour away near Joplin, Mo. Given the growing population density in Northwest Arkansas, Scott Benedict, vice president of partnerships at Rogers e-commerce firm WhyteSpyder, and former director of retail studies at Texas A&M University, said it was only a matter of time before Amazon built a warehouse in the region.

Amazon operates two warehouses in Little Rock, one that takes shipments from the Port of Little Rock and another large package sorting center. Benedict said having a warehouse for final-mile delivery will expedite receipt of packages, although it’s too early to know if that will be next-day or same-day for some items. He said it would also be interesting to see how much grocery or consumables are stocked in the warehouse and what other things it will stock. Benedict said if the new warehouse can cover enough categories and make deliveries in one day or less, it could take some business away from brick-and-mortar retailers like Walmart and Target.

Benedict said that as more households have gotten comfortable ordering just about anything online, the fact that Amazon can perhaps get it to them faster than before is a plus for repeat orders.

Greg Forbis, a supply chain executive at RJW Logistics in Bentonville, said the Northwest Arkansas warehouse would likely receive truckload shipments from larger fulfillment centers, such as Joplin, and then reload into the smaller vans making regional deliveries.

“If the truckload comes in at night, it is likely the customer will get their order the next day,” Forbis said. “It would be faster than having the van load up in Joplin and being driven down to the region. Having a local facility is also how Amazon can reduce its transportation costs. It looks to be the same system that FedEx is using out of their Lowell facility.”

Benedict said expedited delivery is the name of the game in retail today, and that is not likely to change. Walmart has made same-day “express deliveries” available for $10 on top of Walmart+ membership costs. Walmart makes delivery free for Walmart+ members on millions of items, but it may not be the same day depending on time slots and labor availability. Walmart recently said it is rolling out its InHome Delivery service nationwide. This service has been available in Northwest Arkansas since mid-2021.

“Quick-commerce is one of the outcomes of the pandemic. Prices are up; supplies are down. However, shoppers’ expectations are set for quicker, painless, and error-free deliveries. It’s a challenge for retailers, but also an opportunity for those who can pivot to the needs and expectations of consumers,” said Jon Allen, CEO of Woodridge Retail Group in Rogers.

Forbis said the last-mile warehouse in Lowell could be an entry point or test for Amazon to see if the region can eventually support a larger hub like Joplin. He added that Amazon’s investment in the region is good for consumers. He suspects even Walmart would agree that competition makes everyone better.