What does OZON's 1.5 billion rubles distribution center look like?

Investors have spent 1.5 billion rubles on constructing a fourth distribution center for the internet store OZON.ru.

As noted by Gabbas Kazhimuratov, Partner and Chief Financial Officer of the Baring Vostok Fund (one of the investors in the OZON group), there were some doubts about expanding during the crisis, including among shareholders. But management was able to demonstrate the importance of this step.

On May 17, the online store OZON.ru opened the fourth branch of its main distribution center in Tver. The increase adds 14,000 sq.m to the facility's area, making the total area 40,000 sq.m.

OZON.ru was founded in 1998. Currently, 2.5 million people make purchases through the internet store every year; the majority of its customers are in Moscow, followed by St. Petersburg and Tver. To maintain the best prices, the company continuously compares 700,000 products from its competitors.

"The Tver warehouse complex is a key part of OZON.ru's business," emphasized CEO Danny Perekalsky at the site's opening. "Today, 95% of all orders are compiled in Tver."

Investors in the OZON group, which is working to develop one of Russia's largest online stores, OZON.ru, include: Baring Vostok Private Equity Fund, Sistema Joint-Stock Financial Corporation, MTS, Index Ventures, ru-Net Ltd, Rakuten, Intel Capital, Holtzbrinck, and Cisco.

Currently, five million items for purchase are stored at the warehouse, and now three million more will be added to that amount. The items are divided into 14 categories, from books to groceries and electronics. Interestingly, among the best-sellers are: mascara, robot vacuum cleaners, Samsung Galaxy smartphones, and, in the book division, All the Kremlin's Men—A Brief History of Modern Russia.

According to Elena Obraztsova, the Director General for OZON Production and administer of the Tver complex, the complex has become one of the largest employers in the Tver Oblast; by the end of the year, the complex will provide 2,000 jobs.

In response to questions from Retail.ru, Zoya Lee, the Director General of OZON Delivery, reported that 96% of all orders are transported and delivered by the company itself, and only 4% are handled by federal services, including the Russian Post. As a rule, they manage the farthest and hardest to reach regions, where there are no corporate points of issue, while OZON covers 3,500 other areas, plus courier delivery. In addition, OZON Delivery serves major retailers, such as Detsky Mir. Pictured are OZON.ru's top managers Danny Perekalsky and Zoya Lee.

Currently, 30% of OZON's customers receive their order the next day, or, as in Moscow and Tver, on the same day as the item was ordered. A new regional storage center with 4,000 sq.m will be opened in Krasnodar during this year's current quarter, which will allow for same-day delivery in many key cities in the south of Russia.

One of the most unique and expensive technical solutions in the newly expanded facility is a Posisorter from VanderlandeIndustries. This system automatically sorts prepared orders that are ready for delivery. It has a capacity of 4,500 packages per hour, or 108,000 in a 24-hour period. OZON.ru's CEO Danny Perekalsky said that the conveyer reminds him of Disneyland.

The packing department. One difficulty is that all the packages are different sizes, and they will only become more diverse. OZON.ru is now beginning to work with oversized goods, such as washing machines.



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