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A Look Inside Newegg

An anonymous reader writes "AnandTech has an interesting look inside Newegg's 180,000 square foot facility. Effectively, they followed the path of an order after it was soon placed online. AnandTech was able to get a tour of their facilities before, but this is the first time they allowed them to publish any photos."

23 of 327 comments (clear)

  1. New Egg not one of my faves by queenb**ch · · Score: 4, Interesting

    If I'm buying for myself, it's probably not going to be from New Egg. I can usually get the same stuff elsewhere on the net for less money.

    If I'm buying for work, I've got a list of approved vendors from the bean counters- *eye roll* and New Egg isn't nearly stuffy enough and hasn't bought any of the bean counters lunch often enough to make it on their list (just my best guess at how vendors are selected).

    It's nice that they have wicked cool facility, but if you really want to see some supply chain stuff in action, visit Wal-mart. Now you can order any thing off the Walmart web site and have it delivered free to your local Walmart. Show me how those orders are processed, and as much as I hate Walmart, you'll definitely have my attention.

    2 cents,

    Queen B

    --
    HDGary secures my bank :/
    1. Re:New Egg not one of my faves by Leomania · · Score: 2, Interesting

      Newegg has generally treated me pretty well; just last week paid a few bucks extra for a laptop HDD but I knew I'd get it quickly and sure enough, I did. But there was some funky thing about a 1-year subscription to PC Magazine that I could opt out of, and in doing so I could send a request to PC Magazine to get back the value of the subscription (something just under $10). I'm going to go ahead and send it in, but I tell you, stuff like that does nothing to endear a company to its customers. It feels like (and probably is) some kind of phoney-baloney bullshit; just doesn't come off as "reputable company" in my book.

      It's surprising to me that there are so many places online to buy computer stuff that vary so widely in business practices... I remember well how some sites linked to by Pricewatch (such as BZ Boyz) would nickel and dime you to death on cpu/mobo combos, or infer that the quality of the components in the Pricewatch price that led you to their site in the first place were sub-standard and you should choose other (more expensive) options. Then places like Monarch Computer, who had few such shenanigans. It's so varied, but they all seem to stay in business.

      I certainly can't say that Newegg has ever really treated me wrong, but still that last transaction left me feeling that if I wasn't paying attention I'd be sending PC Magazine some $$$ that I really didn't want to. I dunno, maybe it's a sweet deal and I just can't see it for what it is. Mostly, I just want to buy things at a fair price (not necessarily the cheapest) and have good service. I guess for the most part they've met that standard.

      --
      You don't use science to show that you're right, you use science to become right.
    2. Re:New Egg not one of my faves by Solder+Fumes · · Score: 2, Interesting

      It's not so much magic, as brute-force labor. The computers do all kinds of fancy things over in their little air-conditioned room, but the actual implementing of the orderfilling is dependent on miles of conveyor and sorting equipment, forklift drivers, and people who split up boxes into the fine-tuned per store replenishments. It's possible for a box or even a pallet to get lost, or sent to the wrong store. Misread labels can cause incorrect sorting. Equipment breakdowns can cause a backlog and inevitable mixing of orders. All of the above problems can be quickly resolved with a good management staff, and amazingly most of them are pretty damn good.

      Wal-Mart has over a hundred distribution centers and warehouses scattered across the nation; Newegg's warehouse is 180,000 square feet but the smallest Wal-Mart centers are over 400,000. Most of them are around 1.5 million and some are over 2 million.

    3. Re:New Egg not one of my faves by Anonymous Coward · · Score: 3, Interesting
      Wal-Mart has over a hundred distribution centers and warehouses scattered across the nation; Newegg's warehouse is 180,000 square feet but the smallest Wal-Mart centers are over 400,000. Most of them are around 1.5 million and some are over 2 million.

      I don't doubt this is true, and I would just like to add, this figure shocked me, check this out:
      "Wal-Mart [...] has doubled its imports from China in the past five years alone, buying some $12 billion in merchandise in 2002. That's nearly 10% of all Chinese exports to the United States."
      [source -- an interesting article itself, and just Google for lots more cites.]

      But just think about that! Wal-Mart buys 10% of everything China exports to the US.
      Here is another perspective:
      "Wal-Mart has a very close relationship with China," says Duke University Professor Gary Gereffi. "China is the largest exporter to the U.S. economy in virtually all consumer goods categories. Wal-Mart is the leading retailer in the U.S. economy in virtually all consumer goods categories. Wal-Mart and China are a joint venture."
      [This is from a pbs.org source.]
    4. Re:New Egg not one of my faves by Detritus · · Score: 2, Interesting

      I can understand why. I used to work for a company that went through a great deal of trouble to pay all their bills at the last possible moment. Anything to keep a dollar in their hands as long as possible. Some companies are worse, they don't pay their bills until threatened with legal action.

      --
      Mea navis aericumbens anguillis abundat
  2. Interesting by theheff · · Score: 2, Interesting

    I imagined an intricate facitility, but wow! NewEgg is the ONLY website I order hardware from online, and it has never failed me. This is like when you watch the discovery channel and learn the entire manufacturing process behind a simple piece of candy.

  3. Return policy by st3v · · Score: 5, Interesting

    Newegg's Return Policy stinks. They charge 15% restocking fees, and if you get a defective item, you have to pay return shipping. They are a big enough company to afford not charging restocking fees. I try not to purchase from Newegg whenever possible. They are not a good deal anymore anyways.

    1. Re:Return policy by wolrahnaes · · Score: 2, Interesting

      Are you ordering the wrong part enough that restocking fees are a major issue? Seriously, the only time you should be returning something is when it's damaged, otherwise it's your fault and the company is free to charge a restocking fee.

      As for returns, just call them up and bitch, you'll get the return shipping credited to your account. Most motherboards have a note on them saying they're warranted through the manufacturer only, but I've still had them accept returns on two defective boards and even immediately ship out the replacement before I had shipped the bad board back (granted, they had my credit card number already, so it wasn't a real risk to them).

      As an internet business, doing real phone support costs them enough that they will generally do anything within reason to get you to stop calling them, which generally means agreeing to your demands of a return equivalent to at a B&M store.

      --
      I used to get high on life, but I developed a tolerance. Now I need something stronger.
    2. Re:Return policy by BoorayJenkins · · Score: 2, Interesting

      Oh ya?

      I ordered the wrong USB cables with an order about 3 weeks ago. I got the mini 4 pin connector on one end. It was my fault, I didn't look close enough.

      I called and told them I wanted to exchange. They explained they didn't exchange, only refund and re-order. I told them that was fine. He said hold on while I get an RMA number. Then came back and said "just keep the cables".

      $18 worth of product, not a lot of money, but this is indicitive of the support I've received from them over the years. They are the only company I order from now for parts. I've built my last 4 systems, bought 6 19" LCDs, and built 2 systems for my office mates. This ads up to several thousand dollars over many many orders, and I've never been anything but satisfied.

    3. Re:Return policy by chickenwing · · Score: 2, Interesting

      I bought a CD-ROM burner for my parents there. The drive had lots of problems, got a replacement (had to pay for shipping) and the replacement had the same problems. At this point, I want to return and exchange for another model. Unfortunately, this drive was marked as covered by manufacturers warantee only. The manufacturers warantee says that the retailer will replace or repair the item.

      So I email newegg on the behalf of my parents and tell them that I want to exchange for another model. They never reply. I decide to post a negative review of the drive to let others know the drive has problems. But as I am posting, I notice that the review policy basically says "no negative reviews, no reviews of defective items". WTF??? I post one anyway and weeks later, I get some lame appology and offer of a $25 gift certificate.

      We are only talking about $35 dollars here, but it bothers me that newegg would do this to my parents. In the past I have spent thousands of dollars at newegg, but after this experience I will never shop there again. If negative reviews are not allowed, how will I know if I am buying a lemon? If I cannot be sure that newegg will allow me to return or exchange for another item, how do i know that I am not just flushing money down the toilet?

  4. Re:Return policy /biased reviews by Anonymous Coward · · Score: 1, Interesting

    Yes! and: Don't trust their user reviews; I complained that I was misled, and got this back: " Regarding the reviews of the products, please note, however, that customer reviews are used at the discretion of Newegg as a marketing device for positive and constructive ways to share the benefit of a product. It is not used as a source for negative commentary as we cannot endorse the validity of any negative comment. Therefore, Newegg is moderated to remove any unproven biased negative comments. " but of course they didn't post this at the top of the review pages. So I thought it was just all glowing, not really a piece of crap, like it turned out to be; and yes I also lost the restock fee and postage too.

  5. Newegg will not do business with our school... by bariswheel · · Score: 2, Interesting

    Ok now that I have your attention, I would like to point that although I can purchase from Newegg using my credit card for our school (which I will be forced to do unfortunately), Newegg will not accept PO's from our University, UC Santa Barbara. I love newegg and buy plenty of equipment from them, for myself. However, they are sitting on a goldmine and I am forced to do business with the likes of CDWG, Zones, and Tigerdirect because of their policy of not accepting PO's from Universities. I've called them a few times and told them to escalate this issue and address it to their management. They told me to go through a convoluted process, and obviously other people have come to this crossroads, so management never sees this issue come up, mainly because no one really goes through the process. If the Tier 1 customer service cared enough they should escalate this issue to their management, but unfortunately I haven't been able to talk to any management. Very fishy. So after all my b+'ing, I still do business with them personally, nothing really beats Newegg.

    --
    Insinct is stronger than Upbringing - Irish Proverb
    1. Re:Newegg will not do business with our school... by Anonymous Coward · · Score: 3, Interesting

      You want to know the reason why they don't accept POs from schools? They're a major fricking pain in the ass to deal with, you don't get money right away, thirdly and most importantly, they're a major freaking pain in the ass to deal with.

      I worked for a university, and I was was tasked with purchasing lots of tools when it was decided we needed to upgrade. I bought up over $350,000 dollars of welders and supplies, metal working equipment, machine tools (including a good sized 3 axis CNC mill, a small 5 axis mill ,a couple small CNC lathes) and basically everything a bunch of engineering students need for their various projects... Basically, everyone thought it would be awesome if we could almost built an entire small turbine engine in house... So, yeah, that's what i went after.. Aside from some precision grinding, and some bearings, etc, it was certianly feasible.

      Two months later, when all of this stuff is going strong and we need consumables, I couldn't get anything from anywhere I dealt with previously. The university lost $200,000 worth of POs from various companies, and they companies didn't complain loudly, because quite frankly, we were a drop in the bucket compared to what they were used to. I'm sure the shit would have really hit the fan later... But I had enough of that position anyhow, and this was the last straw.

      What I'm saying is that even though you might not have a hard time internally within your school, some companies take a very harsh stance when you go to purchase anything from them, simply because they have had hard times.

  6. Re:hmmm by Matt+Perry · · Score: 2, Interesting

    How did you even find that special advertising section?

    --
    Slashdot: Failed Car Analogies. Amateur Lawyering. Anecdote Battles.
  7. What ever happened to 2AM, $3 overnight shipping?? by green+pizza · · Score: 5, Interesting

    Believe it or not, this isn't a troll. From about 1993 - 1999 there were dozens of printed catalogs that offered overnight (technically same-day) shipping if you placed your order before 2AM EST. For $3 your package was delivered by Airborne Express (now DHL) by 10AM that SAME DAY! I ordered many computer parts over the phone around the 2AM deadline and had them in my hand just 8 hours later. And this was to Fargo, North Dakota. Amazing IMHO.

    The first time I took advantage of this crazy fast, crazy cheap shipping was when I bought my Newton PDA in 1994. I remember placing my order around 11 PM and paying with the Newton the next morning just after breakfast. I think I ordered it from MicroWarehouse/MacWarehouse. This was many years before the dot-com boom, so I'm still a little baffled at how so many companies were able to update print 200+ page catalogs every month and still offer such awesome shipping.

    As far as I can tell, this all ended around the time of the dot com bubble burst. What I don't really understand is why. Or why they didn't just up the shipping charge to $6 or downgrade to overnight instead of overnight-priority shipping. 4 PM the next day isn't a whole lot worse than 10 AM the next day.

    I miss those days. Now it seems like NewEgg's 1 - 2 day order turnaround + freeish FedEx 3-day shpping is the best I can find in the same price ballpark. I can usually order from NewEgg on a Monday morning, opt for the Free to $5 shipping, and have the item by Thursday afternoon. Good but still nothing like the 8 hour delivery I experienced for most of the 1990s. Now with online ordering, better tracking/sorting, and greater package delivery competition you would think that $3 - $7 overnight shipping would still be a possibility. Or at the very least, give me back the 2AM cutoff again instead of this 5PM sillyness.

  8. Re:Newegg is awesome by Anonymous Coward · · Score: 1, Interesting

    Hmm, I ordered five items a few weeks ago, total shipping of like $25, or $5 per item even though it totalled about three pounds. The "3 day" UPS shipping took five days for two of the items, which were ALL shipped separately.

    I like Newegg's products selection and reliability, and the prices are okay (no good computer stores local to me), but not being able to combine shipping costs is crumby, and the shipping options stink.

  9. mod parent up by green+pizza · · Score: 2, Interesting

    DigiKey is located in tiny Thief River Falls, Minnesota... about half an hour from Grand Forks, North Dakota and about 90 minutes from Fargo, North Dakota. They have a huge complex of warehouses full of electronic components. Every chip, diode, resistor, LED, sensor, etc etc etc you could ever imagine. Their print catalog is two inches thick and doesn't even contain half of their inventory! I've never toured their warehouse, but based on their inventory and quick shipping I can only imagine how awesome it must be!!

  10. Re:Newegg is awesome by nachoboy · · Score: 2, Interesting

    "Also I use the $2.99 "expedite my order" feature to get them to ship the same day (of course i make sure i order early enough)"

    Do you also check that box on your tax form that says "donate $3 to the presidential campaign fund"? The suggestion is that it somehow affects your taxes, but of course it doesn't. You just pay an extra $3.

    Coincidentally, that's pretty much all that checkbox is at Newegg either. They may as well label it "Check here to pay $3 more for your order." Try not checking it some time - you'll be surprised that your order still arrives just as quickly.

  11. Several warehousing problems. by Associate · · Score: 2, Interesting

    Namely, product on the floor, not on pallets. This may seem like an odd requirement until you realize that fire hoses leak more often than they are used to put out fires. Also a forklift is less likely to crush something sitting on a pallet.
    Product in the rack storage area above head height should be wrapped. I believe this is an OSHA requirement. Even if not, packaging can be damaged if it falls to the floor. And while the packaging is no doubt designed for impact resistance, no one wants the can of beans with the dent in it, nor the dented scratched up box, reagrdless of what's inside.
    Garage bay doors should not be open unless they are blocked with security gates. This keeps people from falling off the dock as well as lowers the point of breach. The box recycler is also another point of interest. I wonder how many pieces of memeory end up in the crusher.

    And while this may be an advertising ploy, no doubt someone at newegg will see this thread. Hopefully they improve upon their environment.

    --
    Someone hates these cans.
  12. Re:What ever happened to 2AM, $3 overnight shippin by great+om · · Score: 3, Interesting

    I hate when they won't just leave the package. I can understand if they'd like to get something in writing saying that they're not liable for the package once it is out of their hands, but let me fax them some standard form, which they can keep on file. No one in my house is ever home during business hours, and my wife's job doesn't allow personal packages to be sent to her work address, and my job has such over active security (everything has to be hand checked, and put through a metal detector/xray by security), that there are packages I wouldn't and can't have come to work.


    Around here, UPS never just drops the package --except when it is an amazon super-saver (although fedex will most of the time), I will actually not shop at online stores who's shippers have given me the "will try again X# of times" slip --I'm simply not going to be home.

    --
    ------- Oh damn.... the Sigfile escaped... -Great OM
  13. Re:Returned DOA hard drive no problems by dreamer-of-rules · · Score: 2, Interesting

    Since I found NewEgg a year ago (through Slashdot), I've placed over a dozen orders with them, both for work and personal orders. Only had one problem with a shipment, one of five hard drives was DOA. I filled out the online RMA request, shipped it back that day, and got a replacement within three business days (cross-shipped I think). I am *really* happy with NewEgg prices and reliability.

    Compare to Fry's, Best Buy, Good Guys.

    I will not shop at TigerDirect since the whole Mac OS X "Tiger" "I'm-an-attention-whore" lawsuit.

    --
    Everyone is entitled to his own opinions, but not his own facts.
  14. Re:Looks fishy to me. by fr1kk · · Score: 2, Interesting

    While this might seem like a blatent newegg fanboy rant, here is my story:

    Newegg is the best company I have ever done business with. period. I have built several personal computers with them. I am to the point where I will buy from them even if I can get a product for 15% cheaper somewhere else. The number one thing that they have going is customer service. period. Sure, they are consistent. They prices are awesome, and the website is very helpful. But they have a hands down no questions asked return policy. I take advantage and it makes my life SO much easier. All of these cases below are from the same hardware purchase, and the same model of hardware.

    I am on my fifth video card. For whatever reason, over the past year and a half my video cards haven't worked properly. Sometimes it was because I was dissatisfied with the performance. Maybe I fried it when installing on shag carpet. it doesn't matter. A year and a half later, and five cards later, I have not paid nothing more but shipping for replacements which are covered by manufacturers warranty.
    I am on my third motherboard. I blew out one by putting the ram in backwards (note: WHAT? HOW DID YOU DO THAT! THEY ONLY FIT IN ONE WAY!. Thats what I thought. MAN! You wanna see fireworks? Try putting ram in the back of an Antec Aria case in a dark room. You hear a click and think its in. You think "That was a little tough to get in, but hey! it made a click!". Have you ever seen a northbridge chip explode?) Another one got hit by a power outage. I dont even have to lie to get an RMA. "Hey. My Motherboard smells like burnt plastic. I need a new one."
    I am on my fifth ram stick. I bought two 512mb sticks, and I can't get them to play nice together when overclocking. I blamed bad memory sticks, but it may be other issues. They work great for stock speeds, but I needed more.

    I have several other stories, but these are the most extreme over the last two years. Obviously I tend to tinker a bit more than a regular PC user, but newegg is my krutch. They have 100% of my business.

    --
    sig: Playfully doing something difficult, whether useful or not
  15. Re:Newegg quietly triples shipping charges by nbritton · · Score: 2, Interesting

    What pissed me off the most was the switch to UPS, and then doubling the price for the equivalent FedEx service.

    FexEx 3day service takes 2 days to get here.
    UPS 3day service takes 4 days to get here. And we are less then 50 miles from one of UPS's main hubs!!!

    My first order with them was on 7/15/2002, my invoice list is 7 pages deep and I spend thousands of dollars per year at their store and this is the thanks I get!!!

    Needless to say, I've been doing more business with other vendors.