Winners and Losers and Magic Machines.

January 22, 2002

Winners and Losers and Magic Machines. Kmart has lost its way. After years of being the onestopshop it lost out to Target and Walmart. I think I've been in one Kmart ever, which may help explain why they're going down. Amazon, on the other hand, has turned things around. They have posted their first quarterly gain, which was $5 million. It's a good start and it put them ahead of what the analysts had predicted. It appears they just got smart and started to automate a lot of tasks with fancy machines that do all their sorting for them. For those who don't want to sign up for a NYT web password, here is the gist:

The drumbeating constraint is the $25 million Crisplant sorting machine at the center of Amazon's automated approach. Working with batches of 500 to 2,000 orders, the employees with the hand-held terminals feed items onto a network of conveyor belts into the sorting machine. The machine reads the bar code on each item and routes it into one of 2,100 chutes, each chute representing an order for a single customer. When all the items in an order are in the chute, a light flashes, and a worker rushes to put them in a box. They are then sent on other conveyers to machines that print packing slips, seal the boxes and send them off to shippers' trucks.

I want to see this thing in action. Apparently they had 1/3 of the staff this holiday season compared to the last and had a 15% gain in sales. I like that. Also, the person who oversees this fantastic machine is called the flowmeister. I would easily work at amazon if I could attain that title. So once again, kudos.

Advertisement