May 16, 2023: A top executive stated that Amazon utilizes artificial intelligence to speed deliveries by minimizing the distance between its products and customers.
Stefano Perego, vice president of customer fulfilment and international ops services for North America and Europe at Amazon, outlined how the company uses A.I. for logistics.
Perego said one area is transportation, such as mapping and planning routes, considering variables like the weather.
Another area is when customers search for products on Amazon to help them find the correct goods.
But Amazon’s current key focus is using A.I. to determine where to place its inventory.
“I think one particular place that we consider key to lower cost serving is inventory placement,” Perego said.
“So now, you’re familiar with our vast selection of our customers. Imagine how complex the problem is of deciding where to place that inventory unit. And to place it in a way that we decrease the distance to fulfil to customers, and increase the speed of delivery.”
Amazon has been focusing on a “regionalization” effort to ship products to the people from warehouses closest to them instead of from another part of the country.
But doing so requires technology capable of analyzing data and patterns to predict what products will be in demand and where.
That’s where A.I. comes in. Amazon can make similar-day or next-day deliveries if a product is nearer to customers like its Prime subscription service offers.
Perego stated that the efforts are progressing well. In the United States, over 74% of the products customers order are now from fulfilment centres within their region, according to Amazon.