An Amazon employee delivers packages during the coronavirus disease (COVID-19) outbreak in Denver, Colorado, USA, April 22, 2020.
Kevin Mohatt | Reuters
Amazon is relieving some of the pressure on third-party sellers packing and shipping their own orders due to the ongoing limitations of the coronavirus for major carriers.
Last August, the company announced that from February 2021, members of Amazon’s Seller Fulfilled Prime program would be required to deliver on Saturdays and meet the one- and two-day delivery targets.
In a note sent to sellers on Tuesday and reviewed by CNBC, Amazon said it was temporarily loosening delivery speed targets for SFP members in response to pandemic-generated “constraints on the logistics industry.” It means that Amazon will give SFP members a pass if they can’t provide one- and two-day delivery speed for some of the shoppers.
“While we know that salespeople like you are working to raise the bar for Prime customers, we also understand that the pandemic has introduced limitations to the logistics industry that you depend on to meet customer expectations,” said the note. “In view of these constraints, we are adjusting the one- and two-day delivery targets.”
An Amazon spokesperson confirmed to CNBC that the changes were announced to sellers on Tuesday.
Launched in 2016, the SFP program allows third-party sellers to consider inventory for two-day shipping and display the acclaimed Prime badge on their lists without paying for Amazon’s fulfillment services, Fulfillment By Amazon.
With SFP, sellers store their own products and package their own orders, while delivery is managed by carriers such as the US Postal Service, FedEx, or UPS. Major carriers have experienced unprecedented pressure on their systems during the coronavirus pandemic and the Christmas shopping season due to increased e-commerce activity.
Additionally, UPS and FedEx are likely to face even tougher 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 how often those delivery options are shown to customers when they view a seller’s product listing. As a result of Tuesday’s update, SFP members only need to guarantee delivery within two days or less for 55% of people who view their product listing.
Starting in June, SFP members must show delivery speeds of two days or less for 70% of people viewing their product listing. Sellers must still support Saturday or Sunday delivery and collection, as well as nationwide delivery starting February 1.
Amazon announced the change last summer to give sellers enough time to prepare and interact with carriers, the company said at the time. The move has been criticized by some outside salespeople who say it could put a strain on their operations if they have to work weekends.
Sellers who fulfill their own orders struggled to meet Amazon’s two-day delivery goals, even before the coronavirus pandemic. Less than 16% of SFP orders in the US were delivered in two days, largely because sellers don’t work on weekends, Amazon said last August.