Amazon broke sales records during the pandemic. However, after that boom, in which there were many hirings, bad financial results and many layoffs. So Amazon has decided to impose new changes and this time it will have to do with his way of stocking up on merchandise.
Starting April 16 Amazon’s modus operandi will gradually changealthough they are already notifying their distributors.
Amazon will bet on producers
As of next April, as reported by El Economista, Amazon will change distributors for producers to lower their costs. Starting next April 16, it will work directly with brands and manufacturers, trying to eliminate intermediaries and thus reduce costs and improve profitability. With this new policy, it is estimated that Amazon will make a clean profit of approximately 30%.
«The company seeks to cut costs, the more intermediaries there are, the more costs it will entail. Basically if there is an intermediary it requires additional financing or part of Amazon’s profit margin »says Enrique Bernad, an Amazon specialist. “Distributors are not going to be fired directly, but little by little they will have fewer and fewer orders and they will be forced to change their business model, although it will offer them solutions.”
What changes will it have for the consumer
Once the company vision is understood, what is expected for the consumer are two great improvements. On the one hand, Amazon is expected to have greater control over its products and to offer more variety of products at a lower price. Nevertheless, “How it will work cannot yet be speculated, the impact cannot be known. At the moment, the company has to agree with all the venues»says Bernard.
The company itself defines it like this: “We regularly review our product supply chain in order to control costs and offer low prices to our customers. With this objective, we have taken the decision to purchase certain products directly from the brands. We will continue to purchase products from those wholesalers and suppliers who own the brands or have been granted the rights to sell and distribute such products. Both wholesalers and distributors can continue to work with Amazon, and if they so decide, they can sell their products directly in our store through Amazon Marketplace, like any of our business partners.”.
