Amazon shutters warehouses for first time since 2006

Amazon.com is closing a trio of U.S. distribution centers, the first time it's closed a warehouse since 2006. Amazon said the closures in Munster, Ind., Red Rock, Nev., and Chambersburg, Pa. are part of a reorganization of its fulfillment network -- moving capacity to larger warehouses that can "better balance product mix and customer orders." The distribution centers slated for closure employ some 215 people.

Here's more from Amazon spokeswoman Patty Smith:

A variety of factors went into the plan to close these three buildings. We added approximately 3 million square feet of capacity in the North American fulfillment network in 2008, and will be converting a fulfillment center in Phoenix to accommodate our larger items (such as big screen TVs) and adding several hundred thousand sq feet to that facility. This additional capacity allows to the opportunity to better balance product mix and customer orders across the network year-round.

The 215 workers at the three warehouses slated for closure will receive pay through May 25, receive benefits through May 31, and get a minimum of 3 weeks severance pay, according to Smith, who said "eligible" workers will be offered the chance to transfer to other U.S. distribution centers.

Smith said Amazon now has "dozens" of fulfillment centers, but didn't provide the exact number. Amazon on its website says it has fulfillment centers in 12 U.S. states and 8 foreign countries.

Amazon seems to be paying a lot of attention to its warehouses lately. Amazon CEO Jeff Bezos recently spent a week working in a fulfillment center in Lexington, Ky.

The closure of the Munster warehouse was first reported by the Post-Tribune of Indiana, which noted that the facility opened just 18 months ago.

About Eric Engleman

ERIC ENGLEMAN is senior technology staff writer for TechFlash and the Puget Sound Business Journal, covering online retail giant Amazon.com. Engleman tracks Amazon's increasingly complex business, spanning ecommerce, Kindle, cloud computing, and more. He's been covering technology and other industries for the Business Journal since 2003.

READ FULL BIOGRAPHY

206-876-5430

@ericengleman

Recent Sponsor Posts

Seattle University Software Engineering

Chinwe Okeke (MSE’08) pursued her graduate degree while working as a developer and technical analyst for the Boeing Company. She picked the SU-MSE program for small class sizes and real world learning opportunities offered through the academic service-learning and capstone projects.

The MSE program at Seattle University is geared for working professionals with classes offered in the evenings. The program builds upon the computing experience of its students and offers courses in a variety of technical and management areas of software engineering, with an emphasis on teamwork and a disciplined approach to problem solving.

MORE INFORMATION

Marchex is Hiring!

Marchex is one of Seattle’s largest ad technology companies with 300+ employees providing call and click based performance marketing products, and managing over $100m in ad budget for tens of thousands of advertisers. Our customers range from local businesses to the Fortune 500.

Our talented and creative product engineering group is hiring.

If you are an innovative software design engineer interested in solving difficult problems at scale, across a wide array of technologies from Lucene to Hadoop to Asterisk and SIP then we’d love to hear from you!

Apply now.

MORE INFORMATION

Technology Tax Planning – Did You Take The Deduction?

Technology companies require professional advisors who can assist in all aspects of the business. The BDO Technology Practice provides a full range of services tailored to help address the changing needs of domestic and international companies. In addition to core audit and tax services, BDO professionals can assist technology companies with:

· Revenue recognition

· Business combination accounting

· R&D tax credits

· Compensation and benefits

· Business valuations

Backed by 38 national offices and an international network in 110 countries, we have the domestic and global footprint to serve growing technology companies. Contact sphilpott@bdo.com (audit partner), mreeves@bdo.com (audit partner), psmith@bdo.com (tax partner), tzambito@bdovaluation.us.com (valuation), tfiscus@bdo.com, Director, 206.624.2020

MORE INFORMATION