Amazon Shifts Operations After Municipal Body Seals Building Housing Its Delivery Centre In Delhi

In September, South Delhi Municipal Corporation sealed a building in Vasant Kunj, New Delhi, housing Amazon’s delivery centre

An Amazon spokesperson told Inc42 that the company has moved its delivery operations to a nearby centre

Amazon had leased the facility and did not own it

Earlier today (October 4, 2018), reports surfaced that the South Delhi Municipal Corporation (SDMC) has sealed a building in Vasant Kunj area of New Delhi that housed a large Amazon India delivery centre, saying the building was constructed illegally.

The reports added that the landlord had undertaken additional construction in the building where Amazon occupied one of the floors. It was further noted that Amazon had leased the facility and did not own it.

It was also suggested that Amazon was planning to appeal to the Municipal Corporation of Delhi (MCD) Appellate Tribunal to see if the company can retrieve its inventory from the sealed building.

However, talking to Inc42, an Amazon India spokesperson said that the municipal action happened in early September and that the company has already addressed the problem by shifting its operations. 

The spokesperson said, “A leased delivery station in Vasant Kunj was sealed by the South Delhi Municipal Corporation in early September because of some irregularities identified by the SDMC with the landlord. We have since then moved our delivery operations from this building to a nearby location, ensuring there has been no customer impact.”

Also, Inc42 was not able to confirm any kind of involvement between Amazon India and the Municipal Corporation of Delhi (MCD) with respect to the case.

Current Status Of Amazon India Warehouses

It must be noted that Amazon is currently running three large warehouses in Haryana at Sonipat, Jamalpur, and Tauru to address the demands of Delhi-NCR and nearby states.

The company recently launched its 250K-sq-ft fulfilment centre (FC) in Jamalpur, near Gurugram, with close to 1.2 Mn cubic feet of storage space. Only a week after the inauguration of the Jamalpur facility, Amazon announced the launch of its biggest Indian FC in Hyderabad.

Since its entry into Indian ecommerce in 2013, Amazon has been adding warehouses and fulfilment centres to expand its reach to consumers across the country, taking the total number of Amazon India fulfilment centres to 50. Comprising a total of 20 Mn cubic feet of space, these Amazon FCs are present in 13 states across India.

Amazon India is looking to strengthen its logistics capabilities with geotagging and new-age technologies such as artificial intelligence (AI) and machine learning (ML).

Gearing up for the festive season ahead, Amazon had expanded its fulfilment network across first-mile, middle-mile, and last-mile operations and invested in technology to support a faster movement of customer orders.

Amazon has close to 30 sort centres spread across 17 states with a processing area of close to 1 Mn sq feet. Also, it has doubled its last-mile Service Partner Network with more than 700 stations in nearly 500 cities and towns across every state and Union territory in the country.

The company had also announced plans to increase its storage capacity this year by 1.5X over the previous year. The new centres were to be added in Bengaluru, Mumbai, Delhi, Vijayawada, and Kolkata ahead of the festive season.

The Indian ecommerce battle has been heating up among the big three — Amazon, Flipkart, and Paytm Mall. Amazon’s arch-rival Flipkart, which was recently acquired by Walmart, too has been ramping up its logistics ahead of the festive season. In March, Flipkart revealed its plans to set up 4.5 Mn square feet state-of-the-art logistics centre in Bengaluru, following which it also announced its 80-acre logistics centre in Kolkata to cater to its customers in the east and northeast India.

With barely a week left for the festive season sale face-off of the major ecommerce giants, the municipal action on the Amazon’s delivery centre in one of its main markets could have been a big setback for Amazon. However, looks like Amazon saved the day with its quick action.