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Why We Rerouted 14 Million Packages Last January

A single routing algorithm change cost us $38 million in three weeks. Here is what we learned about the real price of optimization.

Rajan Mehta Jan 22, 2025 12 min read

I spent the last two weeks of January 2025 in a Seattle fulfillment center, watching a dashboard count every misrouted package. By the time we rolled back the change on January 29th, the counter read 14,312,608.

The Cost of a Greedy Algorithm

Our logistics team had pushed a minor update to the routing engine on January 6th: consolidate shipments heading to the same zip code prefix, even when they started in different fulfillment centers. In theory, it would reduce last-mile trucks by 11%. In practice, it created a cascade of mis-sorts we did not catch for nine days.

"We optimized for truck utilization and forgot that packages still need to arrive at the correct address."