Sunday, May 30, 1999
Amazon.com to open two warehouses in Ky.
BY JOHN ECKBERG
The Cincinnati Enquirer
Amazon.com, the Internet's biggest seller of books, videos and music, plans to open two distribution centers in Kentucky this fall — initiatives to reduce shipping time to Midwestern customers and bring hundreds of jobs to Commonwealth workers.
The company intends to expand a 570,000-square-foot warehouse to 770,000 square feet in Campbellsville, about 90 miles south of Louisville, and transform an existing 600,000-square-foot warehouse south of Lexington by the end of the third quarter 1999.
“Cincinnati customers will be getting books at least one day faster through these new centers,” said Bill Curry, director of public relations for Amazon.com. The two operations might employ 1,500 people within two years, company officials said. Sites were chosen for better proximity to Cincinnati, Detroit, Chicago, Indianapolis and Minneapolis.
“The Campbellsville location will employ up to 1,000 people, and with our unemployment rate at 17.2 percent, it means that people will not have to leave this area to find work,” Campbellsville Mayor Paul Osborne said. The warehouse to be occupied by Amazon.com is a former distribution center for Fruit-of-the—Loom.
“This is coming at an excellent time for us,” the mayor said. “It's not any trouble to smile around here today.”
Sites were picked after an extensive data-based search of ideal locations based in part on clusters of existing customers, said Mr. Curry. He would not say whether Greater Cincinnati was considered for a warehouse.
“We needed to find facilities huge enough and already existing. We are moving rapidly. Less than a year ago, we had 3.1 million customers. Today, we have 8.4 million customers,” he said.
“We don't have the luxury of finding a clear piece of land and starting from the foundation up.”
Amazon.com's primary domestic shippers are the U.S. Postal Service and United Parcel Service. The UPS hub near Louisville played a role in the decision to locate there, he said.
The Kentucky warehouses will dwarf the company's Seattle distribution center of 93,000 square feet. By the end of this year, the company will control or own 2.7 million square feet of warehouse space in the United States. Other warehouses are in Coffeyville, Kan., Fernley, Nev., and New Castle, Del.
Although the company's customer base rose 2.2 million in the first three months of this year, the firm has not turned a profit since it opened its virtual doors in July 1995.
Mr. Curry said profit is not yet a motive for the fledgling Internet powerhouse, and he would not hint at exactly when it would become a priority for the cyber-retailer, either.
“We have not publicly pinned the tail on that donkey,” he said. “We are in a phase of growth right now where we are investing for the future. This is a one-time opportunity to build a lasting and important company.
“Just as the Internet is taking hold, it would be foolish for us to forgo a great investment opportunity for sake of turning an arbitrary amount of profit in arbitrary time.”
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