The numbers are not in Amazon’s favor. The company founded by Jeff Bezos continues to make headlines that make it clear that the business that has been built around the entity might not be all that different from a bubble about to burst. However, for that not to happen, the managers at the head of the group have to make decisions. If the thousands of layoffs that have been announced in 2023 for Amazon warehouses in Spain are not enough, now give in to financial pressure and decide that not all returns are free.
For now only one type of return
The news comes from the United States, but a long time has passed since those days when we thought “this is Spain” and we hide behind the fact that the situation was different there. Today the public is aware that if something happens in the United States, it means that the fuse is only being lit and that the side effect will end up sufferingsooner or later, in the rest of the world.
At the moment, what Amazon has decided is that the returns that are made delivering merchandise to UPS stores, one of the leading courier companies in the United States, are no longer free. The cost of the return that has been commented is 1 dollar per package, which might seem like a symbolic expense due to its low value. But if we think about the enormous number of returns that are made on Amazon purchases, we can easily understand that, for the online store, it is a more than interesting number. In addition, it is already known that to leave behind a service that, until then was free, you cannot charge a high amount. With a cost of 1 dollar, customers may not complain and continue to return to UPS stores due to convenience (if they live nearby, if the packages are heavy, if they are elderly, if they like the service, etc.).
What Amazon executives have also commented is that this charge could be applied only in cases in which customers have closer to their residences return point other than UPS. However, American citizens are possibly the most appropriate to know what this means and if Amazon is not only trying to reduce the return options to which its customers have access. It will be necessary to verify if, within a while, the partners of the electronic giant that process returns do not begin to limit themselves or if other cards are played to pressure towards the payment of the return expenses.
Amazon is facing a difficult situation
The company does not indicate how many returns it suffers each year, but what is known is that in 2021 the National Retail Federation of the United States revealed that returns had been managed on Amazon for a value of 761 billion dollars in merchandise. You don’t have to use the calculator to know that this represents an abysmal amount of returns. Considering that Amazon has to make the relevant transportation service payments to UPS or any other courier company that works with them, it’s easy to imagine that the economic hole that the store is suffering it’s huge.
It is not surprising, therefore, that Amazon’s losses continue to mount and that an untenable situation is being seen in the distance that they have to urgently remedy. Nor should we forget that Amazon’s losses on the stock market have been scandalous with million-dollar figures that would make any executive in a business like his tremble. And some of its most popular services have stagnated, like Amazon Cloud, which isn’t growing as much as it did in the past, while the Amazon Games division isn’t at its best and hasn’t even hit its targets.
So it’s understandable, to some extent, that Amazon is looking for solutions, trying to cut costs and anything that subtracts rather than adds. Returns have started to be collected with UPS, but everything indicates that it could be a trend that is replicated in other cases and that it is becoming more and more important.
Source: USA Today