July 8, 2011

Amazon to add fourth fulfillment center in the Phoenix area

Amazon phoenix Carlos Chavez/The Arizona Republic

The Amazon facility at 6835 W Buckeye Road in Phoenix, where products that are purchased on the comapny's website are pulled and mailed.

Online retailer Amazon.com plans to open a 1.2 million-square-foot fulfillment center in Phoenix that will create hundreds of full-time and seasonal jobs, the company said Thursday.

The planned expansion will create Seattle-based Amazon.com's fourth fulfillment center in the Valley, bringing its total distribution-warehouse footprint in the area to more than 4 million square feet.

The announcement comes on the heels of a recent Amazon.com expansion plan that will add 400,000 square feet to the company's 6835 W. Buckeye Road facility.

The massive online retailer currently operates three Phoenix-area fulfillment centers, where an inventory of items available for purchase through the company's website is maintained and where purchased items are packed and shipped.

As part of a strategy to reduce customers' waiting time after making a purchase, Amazon.com and other large e-commerce providers have set up dozens of distribution warehouses around the country.

The new distribution center will open in an existing building in west Phoenix this fall, Amazon.com officials said.

Although Amazon.com would not disclose the location, real-estate brokers said the only vacant building of that size and potential use is at 800 N. 75th Ave.

Once the planned new fulfillment center opens, Amazon.com will have more than 3,000 workers and a total investment of $150 million in the Valley area, a company official said.

Amazon.com's announcement was lauded by a host of political dignitaries, including Gov. Jan Brewer; House Speaker Andy Tobin, R-Paulden; Phoenix Mayor Phil Gordon; and Don Cardon, Arizona Commerce Authority president and CEO.

Brewer and Cardon were among those who toured the company's 5050 E. Mohave Road facility in Phoenix after a Thursday-morning news conference.

Commercial-real-estate analysts in Phoenix said they expect to hear more announcements from online retailers about expansions in Arizona, in part because of a California law that took effect last week that aims to force out-of-state retailers to charge state sales tax on purchases made by California residents.

Some states, including Illinois, New York and California, have been looking for ways around a 1992 U.S. Supreme Court ruling that holds that a state cannot impose sales tax on an Internet-based purchase if the online retailer has no bricks-and-mortar presence within that state.

The latest move to impose California sales tax on the Web focuses on referral agreements between companies such as Amazon.com and other California businesses.

An example would be if a company received compensation to refer customers to Amazon.com via a Web link that said, "Click here to buy the latest books and movies."

Under the California law, the existence of agreements under which Amazon.com pays referral fees to California businesses should satisfy the court's definition of a physical presence. Similar laws imposed in New York and Illinois are being challenged in the courts.

The two largest online retailers, Amazon.com and Overstock.com, vowed last week to tear up referral agreements with other retailers in California.

On Thursday, the governor mingled and shook hands with workers inside the cavernous Amazon.com warehouse space as they sorted and prepared to ship an eclectic array of items, including books, movies, video cameras, Lego-brand toys and vacuum-cleaner filters.

"What it is all about today is Amazon and what they have brought to our great state: thousands of jobs, millions of dollars in investment. And that money just continues to flow through our community," Brewer said. "It shows that Arizona is beginning its turnaround."

Amazon.com officials indicated Thursday that Arizona's unwillingness to pass similar state-driven legislation has played a role in its expansion efforts here.

"We support federal legislation that would allow states to collect sales tax from out-of-state retailers, but the state-by-state approach is unconstitutional and counterproductive, in our view," said Paul Misener, Amazon.com vice president for global public policy.

"Arizona's policy of not exploring those state-by-state approaches is certainly a welcoming factor for us."

Both Brewer and Cardon said the state's hands-off approach to the taxing issue has been beneficial in attracting new and expanded business to the state.

by J. Craig Anderson and Ginger Rough The Arizona Republic Jul. 8, 2011 12:00 AM

Amazon to add fourth fulfillment center in the Phoenix area

No comments:

Post a Comment


Crave: The Gadget Blog

PCWorld Latest Technology News

CNET TV: Laptops

Blog Archive

Recent Comments