
An Exclusive Tour Inside Overstock's Massive Distribution Center
NEW YORK (TheStreet) -- Overstock (OSTK) - Get Report Chief Executive Patrick Byrne gave TheStreet a tour of the company's nearly 700,000-square-foot complex in Salt Lake City.
The facility is Overstock's biggest distribution center in the country and also houses customer service operations and an art department, where items are photographed for the Overstock.com website.
Byrne showed off an area called the mezzanine, where row after row of merchandise is held before workers pick up the goods for shipping.
"Unlike Amazon (AMZN) - Get Report, you can't really automate our picking because goods come in, and in the Overstock business goods are not perpetual. They come in, they roll over constantly," he said.
Once a customer places an order, it is held in the computer system for about an hour or so in case the buyer changes his or her mind, and the order that arrives at the Salt Lake City warehouse is sent to a "picker" who uses a shopping cart to gather items, Byrne said.
"There's all kinds of computer algorithms behind the scenes, which are doing everything to minimize the amount of foot traffic and getting the products that are ordered most often together, getting them grouped together in the warehouse, just to create efficiencies," he said.
Goods are then stacked on trucks that ship out from the warehouse to locations across the country, with most of the orders received are shipped out within a few hours, Byrne said.
Overstock closely monitors customer feedback for its products, though Byrne conceded that he has had some product misses, like the time he ordered Epilady hair removers.
"That would probably be the dumbest purchase I ever made because it turns out at no price do American women really want that product," he said.
Byrne said that one of his favorite products is jewelry, which attracts wholesale buyers.








