Shulou(Shulou.com)11/24 Report--

According to news in the morning of February 16, Beijing time, Amazon has reportedly warned European distributors to stop ordering next year and buy products directly from brands, in order to avoid losses by cutting some middlemen.

Amazon says the change will begin as early as January next year. The company encourages affected dealers to sell goods in Amazon's online market, where Amazon takes a commission on each sale and charges additional logistics and advertising fees, rather than buying inventory and selling its own goods.

"as part of its procurement policy at the European level, Amazon has decided to focus on purchasing directly from brands," Amazon said. you still have the opportunity to sell these products directly to customers in our stores as a third-party seller through the Amazon market. "

As the growth of its online retail business slows, Amazon is trying to stop losses, which are most severe in the international sectors of Germany, the UK and other EU markets. The company reported an operating loss of $7.75 billion (currently about 53.088 billion yuan) for its international division in 2022, triple that of the previous year.

"like all companies, we regularly review product procurement methods to control costs and keep prices low for our customers," an Amazon spokesman said. "

Amazon was reported to have taken similar measures in the United States in 2019.

Changes in Europe will affect products that Amazon buys directly from wholesalers and sells at a higher price. In the future, Amazon will rely more on third-party merchants to bear the risk of holding inventory.

It is reported that Amazon's average share of each third-party sale exceeded 50% for the first time in 2022. Marketplace Pulse, which samples sellers' transactions, said Amazon's cut on third-party sellers has risen for six years in a row, making it harder for online merchants to make a profit.

Martin Heubel, a former Amazon executive, said changes in Europe could affect about 20, 000 suppliers and limit the availability of products on Amazon.

"given that many brands do not sell directly to Amazon, but rely on distributors to reach customers, this latest move may have a negative impact on supply, thus affecting the overall customer experience," he said. "

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