According to a message sent to its restaurant partners, Amazon India has decided to discontinue its food delivery service by the end of the year.
This comes after a recent decision to close its nascent tech division by the end of the year.
“After a careful evaluation, we have decided to discontinue Amazon Food from Dec 29, 2022. This decision means that you will no longer get orders from customers via Amazon Food after this date. You will continue to receive orders till then and we expect you to continue fulfilling those orders,” Amazon reportedly told restaurant partners.
“Amazon is dedicated to fulfilling all of its financial and other contractual responsibilities, and we’ll help you through this transition, so please don’t worry. Until January 31, 2023, you will have access to all Amazon tools and reports. For any questions relating to compliance, we will additionally offer support through March 31, 2023,” it was added.
An Amazon India spokesperson acknowledged the change.
“We have decided to stop running Amazon Meal, our pilot food delivery service in Bengaluru, as part of our yearly operations planning review process. We don’t make these choices carelessly. The representative responded to an inquiry from ET by saying, “We are ending these programmes in a staggered manner to care for current customers and partners and we are assisting our affected staff during this transition.
In 2020, Amazon began offering food delivery in a few city pin codes before expanding to the majority of Bengaluru.
However, restaurant partners claimed they never noticed a significant uptick in Amazon order quantities.
According to a top executive of one of the biggest cloud kitchen brands in India, “Amazon was not even in double digits in terms of contribution to my overall volumes. The majority of my order volumes came from Zomato and Swiggy.”
According to sources, as part of recent layoffs, Amazon made redundancies in its pharmaceutical division, and this division’s future viability will also be assessed.
“Amazon continues to be committed to offering our steadily expanding customer base the best online shopping experience with the broadest selection of goods at the best prices and with the utmost convenience. We are still committed to India and will keep investing in sectors like grocery, smartphones and consumer electronics, fashion and beauty, as well as our B2B services like Amazon Business, according to an Amazon India spokeswoman.
At least a few hundred workers have been impacted, but the cuts “may run deeper in India.”
According to a New York Times report, Amazon is firing at least 10,000 workers worldwide.
According to a report issued in September by the research firm Bernstein, Amazon India’s performance in the nation was “mixed,” with ongoing losses despite investing $6.5 billion.
Losses at Amazon’s other two operations, payments and logistics, have grown while those at the Amazon India marketplace, Amazon Seller Services, were able to minimise losses by over 23% to Rs 3,649 crore in FY22.
The Bernstein analysis claims that despite competitors Flipkart and Nykaa dominating high-margin sectors like fashion, beauty, and personal care, Amazon has had difficulty expanding its customer base.