Key facts
- Amazon is considering a project called Mercury to expand its same-day fulfillment network to over 1,000 facilities by 2031.
- The goal is to place inventory within 10 miles of about 80% of Prime members in the US.
- Bank of America analysts view the project's estimated $6.8 billion investment as manageable for Amazon.
- Walmart has approximately 5,000 stores, providing fast delivery within 10 miles of 90% of the US population.
- Amazon's same-day sites will carry a narrower assortment of roughly 90,000 fast-moving products.
Amazon is reportedly considering a significant expansion of its same-day delivery capabilities, aiming to establish over 1,000 fulfillment centers by 2031. This initiative, internally dubbed Project Mercury, seeks to place inventory within 10 miles of approximately 80% of US Prime members, according to internal documents reviewed by Business Insider. Bank of America analysts view this strategy as a direct effort to counter Walmart's established advantage in proximity and fast delivery.
Justin Post, a Bank of America analyst, stated that Project Mercury's focus is on making a limited set of high-demand products more accessible rather than broadening selection. He emphasized the strategic importance of Amazon's ability to compete in same-day delivery, seeing it as part of a larger effort to build a denser, faster, and more automated fulfillment network. The bank considers the project's estimated $6.8 billion investment to be manageable for Amazon, with internal projections suggesting it could become cash-flow positive by 2030 and generate $7.1 billion in economic value over a decade.
Walmart currently holds a significant lead, with its roughly 5,000 stores enabling fast delivery to 90% of the US population. The retailer leverages these stores as local fulfillment centers, facilitating same-day delivery for 70% of its e-commerce orders. In contrast, Amazon's same-day sites will focus on a curated selection of about 90,000 fast-moving items, such as household essentials and fresh groceries, rather than its entire catalog. Bank of America also noted that Amazon's investments in faster delivery and automation could positively impact its retail profit margins for several years.