Amazon is simplifying supply necessities for sellers by shifting Covid-19 carriers

An Amazon employee delivers packages during the coronavirus disease (COVID-19) outbreak on April 22, 2020 in Denver, Colorado, United States.

Kevin Mohatt | Reuters

Amazon takes the pressure off third-party sellers who pack and ship their own orders due to ongoing coronavirus restrictions on large shipping companies.

In August last year, the company announced that members of the Amazon Seller Fulfilled Prime program will be required to deliver on Saturdays and meet delivery targets for one and two days from February 2021.

In a notice sent to sellers by CNBC on Tuesday, Amazon said delivery speed targets for SFP members were being temporarily relaxed in response to “logistics industry restrictions” caused by pandemics. This means that Amazon gives SFP members a pass if they cannot guarantee a day or two of delivery speed for some of the buyers.

“While we know salespeople like you are working to raise the bar for Prime customers, we also know that the pandemic has limited the logistics industry that you rely on to meet customer expectations,” it said the message. “In light of these constraints, we’re adjusting our one-day and two-day speed targets.”

An Amazon spokesperson confirmed to CNBC that the changes were announced to sellers on Tuesday.

Launched in 2016, the SFP program enables third-party sellers to qualify inventory for two-day shipping and display the vaunted Prime badge on their listings without paying for Amazon’s Fulfillment By Amazon services.

With SFP, sellers store their own products and pack their own orders, while delivery is managed by carriers like the US Postal Service, FedEx or UPS. Large carriers have experienced unprecedented stress on their systems during the coronavirus pandemic and holiday shopping season due to increased e-commerce activity.

Additionally, UPS and FedEx are likely to face even more severe capacity constraints in the coming months as they prioritize shipping millions of doses of the coronavirus vaccine.

Amazon measures an SFP member’s ability to meet one and two day delivery goals based on the number of times those delivery options are shown to customers when they view a seller’s product listing. Due to Tuesday’s update, SFP members only have to guarantee delivery in two days or less for 55% of people viewing their product list.

Starting in June, SFP members are required to report delivery speeds of two days or less for 70% of people viewing their product list. Sellers must continue to support Saturday or Sunday delivery and pick-up and provide nationwide delivery coverage starting February 1st.

Amazon announced the change last summer to give sellers enough time to prepare and communicate with the carriers, the company said at the time. The move has been criticized by some third-party vendors who claim it could put a strain on their businesses if they have to work on weekends.

Sellers who fulfill orders themselves had problems meeting Amazon’s two-day delivery targets even before the coronavirus pandemic. Less than 16% of SFP orders in the US were delivered within two days, largely because sellers didn’t work on weekends, Amazon said last August.

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