How the coronavirus pandemic is affecting Amazon Sellers
It’s a constantly changing landscape at present but one fact remains constant - the coronavirus pandemic is having a huge effect on the Amazon market place.
Amid the rapid spread of the virus, as government officials across the world tell people to stay home, Amazon has seen an unprecedented surge in online orders, causing delivery delays and items to go out of stock. In response, Amazon has announced that it will hire 100,000 new workers and cease the intake of any new inventory that isn’t in high demand, which is resulting in significant losses for third-party sellers.
Amazon also faces further challenges as it attempts to remove listings for price gouging and false claims about prevention of COVID-19.
Thompson and Holt manager partner Craig Gedey said: “When you’re dealing with an estimated 600 million products on the site, that isn’t an easy task. We’ve seen Amazon block new offers for face masks, hand sanitisers and disinfecting wipes as some Sellers look to take advantage - but with such a vast field, as quickly as some listings are being taking down, others issues are emerging.
“Amazon has said it is creating dedicated teams that search the site 24 hours a day, seven days a week searching for unfair listings. But it seems an almost impossible task - and it is having a knock-on effect for businesses right across Amazon.”
In a special report on CNBC, Chris McCabe, a former Seller Performance Investigator for Amazon outlined the size of the issues in front of the company.
He said: “Amazon has got a monumental task in from of them. It has to protect buyers but also needs to ensure that’s communicating effectively with Sellers who may be listing items inappropriately.
“There have been some delays because Amazon is trying to fight a multi-front war right now in terms of making sure they can still do one-day Prime and get delivering executed as quickly as if there were no crisis right now. Manpower might be limited based on some people calling in sick.”
Amazon has also shifted its focus to deal with the demand created by the pandemic. People don’t want to shop in traditional places and more of them are going online to places like Amazon to buy products.
That is good Amazon’s own profits as they take a cut of every piece of business - but because their shipping centres are now focusing on essential items, businesses selling other products on the site are suffering significantly.
Add in the difficulties created by so many Amazon third-party Sellers relying on supplies from the badly hit China, and it’s not difficult to see why several have reported they are in significant trouble already. Because once you are unable to provide products that you’ve listed, Amazon’s brutal systems kick in.
Amazon Seller Jerry Kavesh warned: “It’s a serious issue - you do not want to run out of stock on Amazon - you’re punished severely by the algorithm.”
Amazon sent an email to Sellers advising them to “cancel previously placed orders that you are no longer able to fulfil, pacing your account on vacation status…” to protect listings from being pushed lower in the rankings.
In a blog post last week, Amazon outlined their stance on serving customers during the current situation, and their plans for adapting to the changing circumstances.
It read: “We believe our role serving customers and the community during this time is a critical one, and we want to make sure our customers can get the items they need, when they need them. As COVID-19 has spread, we've recently seen an increase in people shopping online which has had an impact on how we serve our customers. So in the short term, we are making the decision to temporarily prioritise household staples, medical supplies and other high demand products coming into our fulfillment centers so we can more quickly receive, restock and ship these products to customers.
“We are working around the clock with our selling partners to ensure availability of these essential products, and continue to bring on additional capacity to deliver customer orders. Products already on their way to our fulfillment centers will be accepted. This does not impact products being delivered to customers, or products currently in stock in our store. Customers can continue to buy any in-stock product in our store, and we will continue to deliver them.
“While Amazon will continue taking orders and shipping items from across our store, customers ordering items they don’t need immediately have the opportunity to help others by selecting shipping options that enable us to consolidate orders and make fewer stops in neighborhoods throughout the week, and most importantly, serve customers with the most critical needs first.
“We’re also working to ensure that no one artificially raises prices on basic need products during this pandemic and have blocked or removed tens of thousands of items, in line with our long-standing policy. We actively monitor our store and remove offers that violate our policy.”
Further measures have been put in place in Italy and France this week. There, Amazon says it has temporarily stopped taking orders on some non-essential products.
Customers can still order many of these products from third-party sellers who are able to ship directly to customers, the spokesperson added. Essential products would include food and hygiene items,.
An Amazon statement said the measure will allow “fulfilment centre associates to focus on receiving and shipping the products customers need most at this time.”
A notice on Amazon.it on Saturday read: “We are prioritising the most requested products and some items may be temporarily unavailable. We appreciate your understanding at this time when we prioritise the products that customers need most. All orders already confirmed will be delivered regularly.”
Thompson and Holt’s managing partner Gedey added: “In these constantly changing times, it helps to keep as up-to-date with Amazon’s current policies as possible, so keep an eye on their blog posts and news stories linked to the site. Because of these new policies being implemented we are seeing a number of suspensions being reported - if that happens to you, contact Thompson and Holt for a live online chat.”