When it comes to the e-commerce industry, Amazon has completely redefined warehouse efficiency and customer convenience. Its paid membership, Amazon Prime which promises two-day shipping shipped a staggering amount of 5 billion items to Amazon customers in 2018 for more than 100 million products.
At a traditionally organized warehouse, every product will be organized according to its size, popularity, and category. However, Amazon’s warehouse organizes their inventories randomly and this bizarre management system is the core of their disruptive efficiency. For example, a shipment of 50 tubes of toothpaste may ultimately be distributed to and stored in 50 different places. The result may appear to be chaotic due to its random product placements, but the technology in place has the capability to keep track of every item in its huge warehouses. Amazon also utilizes robot machines, which have resulted in more inventory space and greatly improved efficiency.
While it may seem like a new concept, this random storage philosophy has been utilized since the early days in Amazon for the past 24 years. This same system has proven to be efficient as it has been implemented in their largest warehouse sized at 1 million square feet, which is about 17 NFL football fields in size.