Amazon (Nasdaq: Amzn) has quietly canceled a number of suppliers’ commands in China and Southeast Asia, according to Bloomberg. This decision seems to avoid increasing costs related to American prices, but he left certain suppliers with goods that they cannot sell.
These canceled orders mainly affect suppliers of suppliers and Amazon wholesalers who sell products directly to Amazon, who then claims them to customers. Unlike third -party sellers who manage their own lists and pay Amazon for the space and logistics of the shelves, these suppliers are based on bulk offers and shipping arrangements designed via Amazon.
A familiar consultant with the case told Bloomberg that Amazon had canceled several direct import orders without warning. Because Amazon generally acts as the importer of the file, he normally pays prices once the goods arrive in the United States, but when an order is canceled after shipment, this responsibility moves to the seller leaving them on the hook.
In its 2023 annual report, Amazon reported risks linked to its heavy supply chain in China, warning that global events, security problems or policy changes could affect results. About 40% of the items sold via Amazon come from these types of relations with suppliers showing how wide the impact could be.
This article appeared for the first time on Gurufocus.
