The Beginning

Our journey starts in receiving, this part of the process actually has nothing specifically to do with your order but what's done here makes the rest of the process infinitely easier. Shipping trucks will pull up to the warehouse and unload cargo pallets filled with computer products. A pallet is a wooden or plastic platform that can be picked up using a forklift; palletized cargo is cargo placed on a pallet, which is how Newegg's inventory is shipped to them.

Once the pallets are received and unpacked they are sent off to receiving, which is a mere 30 feet away. The pallets don't just magically appear at Newegg, they are ordered from a set of offices and cubicles attached to the warehouse:


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What you see in the picture below are a few Newegg employees at computer terminals surrounded by hundreds of boxes. What they are doing is scanning each and every item that comes into Newegg. If it's a retail product, such as a boxed AMD CPU, then the retail barcode is used and information is attached to it. If it is an OEM product, such as an OEM AMD CPU, then Newegg will create their own barcode for the product. The bar-coding process is quite important because Newegg's system actually associates a great deal of information with each barcode.


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For every product that's scanned not only are its specifications entered into the system but so are its physical dimensions and the weight of the product. The importance of this is that when your order is placed, Newegg's system knows exactly what size box(es) to ship your order in as well as how heavy your order will be. After your order is complete and before it is boxed up, the weight of the order (as well as the barcodes on each item) is checked against Newegg's database to make sure that you are indeed getting what you ordered.

In the far left corner of the picture above is a station where Newegg will take pictures of any new products coming into their warehouse, which end up being listed along with the product on their website.

After the products are received by Newegg, they are then sent to one of two places - the staging area or "the racks" where actively shipping product is organized and ready for orders that are being placed immediately.

The picture above is closest to the receiving area, and thus is the emptiest of the staging area. Newegg's facility here is no where near full capacity but also important is the fact that Newegg doesn't keep product for very long at all, which allows them to usually take advantage of the best pricing possible and in turn offer highly competitive prices to their customers.

The farther away you get from the receiving area, the more crowded the warehouse becomes:


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  • bldckstark - Thursday, February 16, 2006 - link

    I did not mean to imply that AT was paid for the article, just that it would not be a conflict of interest even had they been.

    Many, many articles are printed for payment in this world every day. Credibility is lost when the reporting becomes biased, incomplete, or incorrect. Show me how reporting on the most liked and largest computer parts supplier in the U.S. creates bias for a site that tests the parts, not the delivery guy. (I believe that's blewboy.com. Not that I've ever been there. And my screen name is not Wun Hung Guy either.)

    Heck, AT doesn't even order most of the parts they test, they are sent by the manufacturers.

    You are not being reasonable. Would Anand have retained his credibility if he had coined an article on Coca-Cola's warehousing system? Think about it.
    Reply
  • bldckstark - Wednesday, February 15, 2006 - link

    So why do you care? Creating an article showing the people who buy most of the stuff coming from the largest supplier can only be a good thing. I know when to order from Newegg and when not to. I can type in different addresses to Zipzoomfly (googlegear!) and Mwave to check prices. Why should any of us care if Anand got paid for this, this site is a business too, in case you didn't know. A payoff from Newegg for an article wouldn't be a conflict of interest for AT anyway!

    Consider the fact that all high volume warehouses are run in a similar fashion and you might realize that the article was fun but worthless as advertisement. Few people out there are going to assume that all other suppliers box their stuff up in torch lit caves. This is more about a process than a company. Every manufacturer I have ever worked for had a similar warehousing system to get parts to the assembly areas.

    Now get back on your ZipZoomFly forklift and get my order shipped out that I placed 3 days ago. Whiner.
    Reply
  • rubikcube - Wednesday, February 15, 2006 - link

    Where are all the oompa loompas? Reply
  • Spacecomber - Wednesday, February 15, 2006 - link

    Skimming through all the positive comments about this article, I'm feeling a bit left out. I seem to be having quite a bit of trouble getting the pictures to pull up on each page. Sometimes they eventually appear, but often I get nothing, even letting the browser window just sit open to the article for several minutes.

    You guys aren't helping EA host the latest BF2 patch on your image file server are you? ;-)
    Reply
  • LoneWolf15 - Wednesday, February 15, 2006 - link

    To all the guys at Anandtech,

    I know a lot of our posts on reviews and articles are critical. It may make it seem like a thankless job sometimes (even if we are only offering constructive criticism, it can often seem like a personal attack). So I'm glad to be able to say I really enjoyed this article, from a techie perspective and as someone who has worked in a warehouse long ago and loves to see how far automation has come in distributing products. Documenting the whole thing and including pictures was a great thing.

    Thanks for continuing to offer us quality articles, and thanks for additionally giving us the chance to win free stuff. Even when we don't say it, it is truly appreciated. And thank NewEgg for us, for offering themselves up for inspection.
    Reply
  • gibbsk - Wednesday, February 15, 2006 - link

    Thanks Anand for the inside look at NewEgg!! I've always wondered how they got things out so fast, and now I know! :)

    Seriously, NewEgg is a great retailer and I have shopped with them for years. UPS Ground from CA to my house was taking a week, but now with this new warehouse in TN, hopefully I will get things sooner!

    Keep up the good work Anandtech and NewEgg!!!
    Reply
  • EODetroit - Wednesday, February 15, 2006 - link

    Wow, I can remember the day when I thought Newegg was just some Egghead ripoff/spinoff company. Then I kept finding the lowest prices for stuff I wanted at their web site. To top that off, they never screwed up an order of mine, where other companies would screw them up (and still do screw them up) all the time. And then they had the user reviews, which were great before they were censored.

    I'm an IT tech at a company with < 100 employees, small company. Been here for a number of years now, and people often come to me for computer advice. I can remember many years ago, someone came up to me asking about the new DVD burners back when they just came out. I refered him to the usual review sites, but I also took him to Newegg's web site, and showed him the user reviews. 10s and hundreds of reviews by people that actually bought the burner, and often ripped it to shreds, saying things like "Newegg rocks, they got this to me in 2 days, but this DVD burner sucks, sorry, get XXXX burner instead". We were both really impressed that Newegg would let those reviews stay, and it really helped him get the best burner for his money that he could. I'm sure he ended up ordering it from Newegg too since I put his computer together for him a couple months later.

    So anyways, eventually we hired an Intern, and with the extra manpower, stopped buying pre-built computers. Now we get parts from Newegg, and I or the intern put them together. With total control over what goes in our computers, I must say we've had MUCH fewer part failures than what we used to get. That let us not hire more IT staff even though the company has doubled in size, I don't have crap parts failing all the time like I used to any more. Without Newegg being so reliable and inexpensive, it wouldn't have happened.

    GJ Anand and Newegg the past 5 years. Hoping for another 5.
    Reply
  • huges84 - Wednesday, February 15, 2006 - link

    Dang the article has been posted on Slashdot. Luckily they didn't mention the contest. But still, I think my chances of winning have been seriously deminished. :( Reply
  • Phiro - Wednesday, February 15, 2006 - link

    None of the pics show up for me now... Slashdot effect? Reply
  • yacoub - Wednesday, February 15, 2006 - link

    The only thing missing is how much discount NewEgg employees get and if they're hiring! ;)

    Very nice article.
    Reply

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