Amazon suppliers received a lesson in centralization on March 7 after the e-commerce giant abruptly began canceling huge numbers of orders in a profits push.
Amazon: We ‘Saw Opportunity’
As Bloomberg reported, quoting a statement from Amazon, the company wants to increase returns at the heart of its e-commerce operations. This has involved fundamentally altering the supply line, forcing even long-time sellers to sell products directly on its marketplace instead of using Amazon as a middleman.
This, reports say, results in reduced costs, as suppliers themselves foot the bill for issues such as storage and shipping. Amazon also takes a commission from each transaction.
“We regularly review our selling partner relationships and may make changes when we see an opportunity to provide customers with improved selection, value and convenience,” the statement reads.
The knock-on effect for suppliers, perhaps predictably, has already touched a nerve. As Bloomberg notes, given purchase orders agreed months in advance, seismic…