published Sunday, January 8th, 2012

Amazon’s Chattanooga distribution center plans to expand

An employee working in the intake section sorts merchandise arriving from trucks inside the Amazon distribution center at Enterprise South in Chattanooga, Tenn., on Thursday.
An employee working in the intake section sorts merchandise arriving from trucks inside the Amazon distribution center at Enterprise South in Chattanooga, Tenn., on Thursday.
Photo by Dan Henry.
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BY THE NUMBERS


• 9 million — Number of items Amazon’s Chattanooga distribution center handled over the holiday period.

• 700 — Internet access points in the building.

• 7 — Estimated miles of fiber in the Chattanooga facility to permit Internet connections.

Source: Amazon

Already the size of 17 football fields, Amazon’s Chattanooga distribution center is about to get bigger.

Fresh off a successful holiday season in which the site became one of Amazon’s busiest in terms of volume of items handled, company officials said plans are to expand operations inside the massive Enterprise South industrial park facility.

Work will start this month on an expansion that will add onto an existing second-level mezzanine and boost floor space to about 28 football fields, said Sanjay Shah, the Chattanooga center’s general manager.

The space is expected to be ready by midsummer. Cost of the work wasn’t disclosed.

“We’re doing the expansion to meet demand,” Shah said in an interview last week that gave the Chattanooga Times Free Press an exclusive first media look inside Amazon’s Chattanooga center.

Eventually the expansion will translate to hundreds more jobs, said the UTC graduate who joined Amazon about a year ago and moved back to Chattanooga to run the local facility after working in Texas and India.

“We’ll have 5,000 [workers] at some point this year” at Amazon’s Chattanooga and Cleveland, Tenn., facilities, he said. That’s well above the 4,000 full-time and temporary workers that Shah said the two locations had at their peak over their first Christmas season.

Currently, he said, Amazon has more than 2,000 workers in Chattanooga, as the company cut back its workforce after the holidays.

Shah said the expansion of the Chattanooga center will involve using space on one end of the facility in which to put more processing equipment and storage space for goods.

Not that there isn’t plenty of room already.

The building is so big that nearly a half-dozen three-wheel bikes sit just inside the entrance to help get people from one point of the facility to another because it takes so long to walk.

CLOSE-UP VIEW

At 1 million square feet, Amazon’s Enterprise South building is about the size of Hamilton Place mall.

Inside, it’s buzzing with activity, running 24 hours, seven days a week.

Visitors hear the rattle of scores of long conveyor systems that line the facility, processing inbound and outbound items.

The Amazon site is a mixture of innovative technology the company has developed over the past decade-and-a-half and labor-intensive work by employees, officials said.

Tom Hamilton, the facility’s inbound senior operations manager, said the Chattanooga location features Amazon’s newest design.

“We’ve come a long way,” he said.

Computer stations are set up along the conveyor lines. Those permit personnel to scan and process the wide array of items that go through the facility and are for sale on the website of what has become the world’s No. 1 Internet retailer.

“It’s very dynamic,” said Shah about Amazon’s distribution processes. For example, each computer station permits its operator to stop the line if he must and seek input from a supervisor should questions about an item arise, he said.

“It empowers associates to make decisions,” Shah said.

Goods that go through the Chattanooga facility are shipped all over the country in the effort to uphold Amazon’s reputation for quick delivery, Shah said.

For instance, the first item shipped from the Chattanooga site was a printer cartridge sent to a California customer.

In the end, Amazon’s distribution network is customer driven, Shah said.

“It’s all about being the most customer-centric company,” he said.

Items that aren’t immediately sent to customers are directed to a huge bank of yellow storage containers. In one area, an expanse of containers stretches from the mezzanine floor to nearly the ceiling and are easily the height of several people one atop the other.

Shah said the facility keeps an inventory of some goods in anticipation of future orders.

“It’s designed to allow flexibility,” he said.

Millions of items, from books to electronics to glassware to name just a few categories, were stored over the holidays, Shah said.

The Chattanooga facility was built to hold generally smaller goods, while Cleveland’s site was more directed to handle bigger items such as TVs, officials have said.

“KAIZEN”

Shah said Amazon practices Kaizen, a system by which employees and managers regularly meet to share ideas aimed at continuous improvement.

“We’re a big believer in that,” Shah said. “The technology couldn’t work alone without people.”

Employee Alice Donohoe, a packer at the center, said the holidays were “very busy.”

She said she joined Amazon about 10 weeks ago because there wasn’t room to grow in her last job.

“Here, I have a chance to grow,” the Chattanoogan said.

Samantha Daniels, the facility’s senior human resources manager, said it was a challenge hiring thousands of Amazon employees — possibly the biggest hiring ramp-up in the city’s history as hundreds were brought on weekly.

But, she said, Amazon didn’t have a problem finding enough qualified workers.

“People are excited to be here,” Daniels said.

Shah cited the help of Chattanooga State Community College in finding workers.

In training its workforce, Amazon starts with safety, he said. Then the company provides workers with the technical training they need, Shah said.

“They have to ramp up to learn to do the job, and we gradually grow them,” he said.

Amazon estimated spending $139 million to put up its two facilities.

The expansion investment in Chattanooga is in addition to new centers the company announced in December it will put up in Tennessee and Virginia.

Amazon is opening four distribution centers — two in Virginia and two in Tennessee — as the Seattle retail giant further expands its capacity to get goods to customers.

With over 50,000 employees worldwide, Amazon has distribution centers in 10 states. Over the past couple of years, the company has built or announced plans to put up nearly a dozen more distribution centers to keep up with the company’s fast growth. Most of the new centers are going up in the South.

Amazon said it will build two fulfillment centers in Middle Tennessee — one each in Rutherford and Wilson counties.

The new centers will create over 1,300 jobs and represent an investment of $135 million, according to Amazon.

Combined with existing facilities in Wilson, Hamilton and Bradley counties, Amazon will be creating more than 3,300 jobs and investing more than $270 million in Tennessee, the company said.

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about Mike Pare...

Mike Pare, the deputy Business editor at the Chattanooga Times Free Press, has worked at the paper for 27 years. In addition to editing, Mike also writes Business stories and covers Volkswagen, economic development and manufacturing in Chattanooga and the surrounding area. In the past he also has covered higher education. Mike, a native of Fort Lauderdale, Fla., received a bachelor’s degree in communications from Florida Atlantic University. he worked at the Rome News-Tribune before ...

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