CNN Business Article May 15, 2023

News for Ecomm Sellers
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New YorkCNN —

Amazon is revamping its delivery operations in an effort to cut costs while speeding up shipping times to the next day or sooner.

Amazon (AMZN) has traditionally operated one national delivery network that distributed orders from warehouses spread across the country. If a local warehouse didn’t have the product a customer ordered in, say, Detroit, Amazon (AMZN) would ship it from another part of the country.

But long-distance shipping has been costlier for the company and led to increased delivery times for customers.

Amazon CEO Andy Jassy has said it is a “critical challenge” for the company to lower the cost to get products from Amazon’s warehouses to customers. So in pursuit of boost its profitability, the company has created eight regions in smaller geographic areas designed to ship products over shorter distances.

“Each of these regions has broad, relevant selection to operate in a largely self-sufficient way, while still being able to ship nationally when necessary,” Jassy said in an April letter to shareholders.

The changes may impact which products consumers see when they search for products on Amazon’s website. Items that are closer to customers will show up higher on results pages, Amazon said.

The Wall Street Journal first reported these changes.

Jassy said the company was seeing more next day and same-day deliveries, and Amazon was on track to have its fastest Prime delivery speeds in 2023.

But it’s not clear yet how important same-day delivery is to customers. Several fast-delivery startups have cropped up to deliver customers grocery and convenience-store orders within 30 minutes, but many of them failed.

Amazon has “convinced themselves people want one-day delivery,” Michael Pachter, a retail analyst at Wedbush Securities, said in an email to CNN. “I needed Gorgonzola cheese for a recipe Saturday, [so I] actually went to the store. I don’t need same day or next day delivery for most things,” he wrote.

The more immediate benefit for Amazon may be cutting costs.

After expanding rapidly during the pandemic, the e-commerce giant cut some 27,000 jobs as part of a significant bid to rein in costs in recent months. Amazon also began charging some customers a $1 fee if they return items to a UPS store when there is a Whole Foods, Amazon Fresh grocery store or Kohl’s closer to their delivery address. (Amazon owns Whole Foods and Fresh, and has a partnership deal with Kohl’s.)

Amazon also recently started adding a “frequently returned” badge on certain products on its website for customers

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Wall Street Journal had a slightly longer article today.

With a different selection of “experts”.

I would assume minimizing transportation costs is at the top of Andy’s top ten list.

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Ugh as a Prime Buyer, and ugh as a Seller paying for advertising (which I personally haven’t done in years).

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Yes, double ugh’s here too. Screw up search even more.

Now that the B&M stores have less selection, Amazon will present less too, unless a buyer wants to dig for what they really want. They seem to assume most purchases are impulse buys to the detriment of discerning buyers looking for what they specifically want.

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Coincidence?

Surely unrelated…

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So, if we’re not logged in to Amazon will we actually see products for sale and not be direct to just the top ones “close” to me?

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Maybe … but browser tracking and location may also play a factor depending on how you have your browser set up.

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As Lost_My_Marbles said, your browser might give up your location. I don’t think private browsing would.

This will make it difficult to accurately check our search results.

It sounds like the further ones will still be in the search but buried:

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For 3P FBM sellers, this might become a ploy to get them to do targeted multiple regional ads to get access into areas outside their region …

For 3P FBA sellers, it could be a way to force them to ship into different regions to sell in each region which thus lowers Amazon’s cost of distribution while placing this cost on the FBA sellers …

When buyers can’t find in their region, will this open the door for Amazon to charge an additional shipping surcharge? … or open the door for a surcharge for extra shipping costs on the FBA seller?

Energy is never lost … it is merely transferred from one object to another object.
Amazon’s operating costs are not eliminated … they are merely converted into fees for sellers to pay.

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Excellent way to communicate what QZTray and “free” shipping really mean.

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This possibility crossed my mind also.

As if we don’t carry enough of the cost burden already.

Higher cost for the buyer eventually.

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It’s called an IP address, unless you are using cellular, then your IP address is very likely giving away at least your city. This is because of IP addresses being assigned in blocks to Internet Providers. Private browsing mode (and most modern browsers) block or ask permission before sharing your location (GPS, etc.) from the system. But you couldn’t do data transfer if the website didn’t know where to send the data (AKA IP Address).

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