Amazon launches one-hour shipping in Manhattan

Employees work at the Fulfilment Centre for online retail giant Amazon in Peterborough, central England, on November 28, 2013
Employees work at the Fulfilment Centre for online retail giant Amazon in Peterborough, central England, on November 28, 2013 launched a service Thursday that promises one-hour delivery of household products to its Prime customers in Manhattan.

Thousands of products like paper towels, shampoo, books, toys and batteries will get delivered within 60 minutes to select areas of Manhattan, the Seattle-based online retail giant said.

"There are times when you can't make it to the store and other times when you simply don't want to go," said Dave Clark, Amazon's senior vice president of worldwide operations, in announcing the service known as Prime Now.

The new delivery service is available to customers enrolled in Amazon Prime, a membership service that costs $99 a year. One-hour delivery costs $7.99 but the company also offers two-hour delivery for free. Prime Now is available from 6 a.m. to midnight, seven days a week.

It faces tough competition, however, from other delivery services in Manhattan, such as grocers FreshDirect and Instacart, as well as Google Express, which delivers from a variety of retailers the same day.

Amazon said it hopes to roll out one-hour delivery to more cities in 2015.

The speedy delivery service comes as a result of Amazon's growing network of fulfillment centers, where it has added new technology to quicken order delivery time. The company has 109 fulfillment centers around the world, more than 50 are in the U.S.

The company has invested heavily this year in upgrading and expanding its distribution network, adding new equipment, opening more shipping centers and hiring thousands of workers to meet the increasing demand. Inc. has focused heavily on improving its reliability in part to avoid a repeat of last year's holiday shopping season, when some customers were disappointed by late deliveries attributed to Midwestern ice storms and last-minute shipping snarls at both UPS and FedEx.

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