SEATTLE — Amazon is moving to meet a surge in demand for household staples and medical supplies by pulling back on stocking items like consumer electronics and toys.
In emails early Tuesday, Amazon told the sellers and vendors that supply the products on its website that it would not accept some shipments into its warehouses for three weeks. That includes halting purchase orders from brands that sell directly to the company and stopping shipments from the third-party sellers that offer goods on its marketplace.
“We are temporarily prioritizing household staples, medical supplies, and other high-demand products coming into our fulfillment centers so that we can more quickly receive, restock, and deliver these products to customers,” the emails said.
On its website for sellers, Amazon said items it was still accepting include groceries, baby products, pet supplies, health and household products and personal care items like shampoo. Amazon will still ship nonessential items to customers if it already has the products on the shelves in its warehouses.
“This is the responsible thing for Amazon to do, to make sure that those essentials are checked in first, and it is impossible to do that if you have millions of other shipments,” said Fahim Naim, a former Amazon employee who now runs eShopportunity, an e-commerce consultancy focused on Amazon.
As Americans hunker down, they have been turning to Amazon in droves to bring products to their doorsteps, not just for toilet paper and hand sanitizer but for all kinds of items, from condoms to puzzles for children.
With sales up, brands have been scrambling to restock Amazon’s warehouses, which has had trouble processing so many products at once. Its loading docks to bring shipments into its warehouses have turned into a major choke point in American e-commerce.
Amazon not only must manage its own demand, but it depends on a work force that lives amid the outbreak. “Amazon is having a double whammy,” said Guru Hariharan, a former Amazon employee whose company, CommerceIQ, advises large brands on their Amazon business. “The warehouse staff is reducing but at the same time orders are increasing.”
On Monday, Amazon announced in a news release that it would hire 100,000 new workers and raise pay by $2 an hour for many employees in response to a surge in delivery orders from people staying at home to combat the spread of the coronavirus. “We are seeing a significant increase in demand, which means our labor needs are unprecedented for this time of year,” the company said.
Consultants who work in e-commerce say it has taken longer to get shipments unloaded into Amazon’s fulfillment centers, where the company picks items and packages them to deliver to customers.
“Outside the warehouse, the trucks are getting backed up,” Mr. Hariharan said.
Normally, orders are processed the same day they are delivered this time of year, he said. But recently, some had taken as long as a week to get unloaded.
He said the large consumer brands he worked with, who sell products like aspirin, Lysol and Huggies, have seen sales 15 times higher than expected in the past two weeks. His clients have told him they are moving products they had planned to send to brick-and-mortar retailers to Amazon instead.
Some products, like webcams people use to work from home, have also seen a burst of sales, though they are being restricted now.
“This past week, sales have been just through the roof on Amazon,” said Greg Mercer, who runs Jungle Scout, a popular data service for Amazon sellers. He said sales were like what they would see during Black Friday or Prime Day, major events sellers and Amazon heavily anticipate.
On products Amazon has deemed nonessential, “customers will see decreased selection on Amazon because of the stock outs,” he said. He also expected that some sellers will ship directly to customers, rather than use Amazon’s infrastructure. Shipping on their own can be more expensive, so he said consumers were likely to see higher prices.
The Amazon emails were reported earlier by Business Insider.