Amazon Flex driver Ricardo Escalona works to deliver his same-day orders during Cyber Monday from an Amazon achievement center in Tampa, Florida, on Nov. 27, 2023.
Octavio Jones | Getty Images News | Getty Images
Amazon is shutting down a service that provides same-day delivery from mall and brick-and-mortar retailers, CNBC has learned.
The corporate has stopped any latest development of the service, called Amazon Today, and can begin to wind it down, in line with two individuals with knowledge of the matter. The people asked to not be named because they weren’t authorized to talk to the press.
The majority of this system can be shut down by Dec. 2, the people said. Select retail partners will give you the chance to proceed fulfilling orders with Amazon Today through Jan. 24, 2025, Amazon told CNBC.
A small amount of employees can be laid off and supplied with severance, while others can be transitioned to other positions inside Amazon, the corporate said.
Employees who work on Amazon Today learned the news in a gathering on Monday, where some staffers were informed they might be laid off, the people said. Roughly 300 employees were working on Amazon Today, the people said.
The closure of Amazon Today is the newest example of the corporate’s broader cost-cutting efforts.
Since 2022, Amazon CEO Andy Jassy has been on a campaign to chop costs across the corporate with a purpose to meet rapidly changing macro conditions. Starting in 2022 and increasing through 2024, Amazon initiated the most important layoffs in its history, cutting greater than 27,000 jobs. Jassy has taken a harder line on the corporate’s unproven, costlier bets than his predecessor, Amazon founder Jeff Bezos. Jassy has axed several projects, including a telehealth service, video-calling device for youths and a roving Treasure Truck.
Launched in 2022, Amazon Today allows retailers who sell on Amazon to supply speedy delivery from their brick-and-mortar stores and shopping malls in select cities. Amazon’s contracted Flex drivers, which make deliveries using their very own vehicles, fetch the packages and drop them at customers’ doorsteps inside hours of when the orders were placed.
Amazon Today was a part of the corporate’s push to get online purchases to shoppers’ doorsteps at faster speeds. Amazon continues so as to add more facilities focused on same-day deliveries in a bid to spice up sales and compete with other firms that provide ultrafast delivery. That features Instacart and DoorDash, which have expanded beyond food and groceries and into retail.
The corporate had signed up several retailers to Amazon Today, in line with this system’s website. That list included Office Depot; Staples; Petco; PacSun; vitamin and dietary complement chain GNC; and Fabletics, the athletic-wear brand owned by actress Kate Hudson.
Amazon is working with the retailers it signed up for the service to make sure a smooth transition for them, the corporate said. Amazon added that it continues to prioritize and put money into fast delivery.
The choice to shutter Amazon Today comes as a surprise since Amazon was within the means of onboarding other retailers, considered one of the people said. The corporate was also pitching the service to more retailers at a conference last week.
The service skewed more costly than traditional delivery routes where Flex drivers can fill their cars up with packages from an Amazon warehouse, considered one of the people said. Amazon Today routes, which the corporate calls “retail deliveries,” didn’t normally replenish a driver’s trunk, making this system less worthwhile for the Flex contractors.
