February 1, 2011, 12:00 AM

Amazon expands its distribution network overseas and in the U.S.

Amazon.com Inc., which finished 2010 with 17.5 million square feet of distribution space, plans to add six more distribution facilities in the U.S. and abroad.

Building on its ability to quickly deliver goods to its global base of customers, Amazon.com Inc. will add more than 7 million square feet of distribution and fulfillment space in 2011, a 40% increase in space, says a new report from Goldman Sachs Global Investment Research.

That would bring Amazon's combined national and international total to 53 centers and 24.5 million square feet. Amazon currently has 22 fulfillment centers in the U.S. and 25 overseas, Goldman Sachs says.

Amazon, which finished 2010 with 17.5 million square feet of distribution space, plans to add six more distribution facilities, including two in Tennessee, two in Japan, one in Scotland and one in South Carolina.

"Larger fulfillment centers for Amazon are more efficient," says Goldman Sachs analyst James Mitchell, who covers Amazon. "Amazon has generally moved from smaller to larger distribution centers in the U.S. in recent years and now appears to be doing so elsewhere."

Amazon's distribution expansion has been particularly aggressive overseas, especially in China. Amazon now has nine distribution centers in China, including four opened last year, Goldman Sachs says.

mark@verticalwebmedia.com

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