Leading e-commerce company, Amazon, has just announced the discontinuation of its same-day delivery service, Amazon Today, which offers fast delivery directly from stores, by December 2.
This decision was taken after an in-depth assessment of rising costs and is a drastic step in the cost reduction strategy under the leadership of CEO Andy Jassy.
Launching in 2022, Amazon Today will allow local merchants to offer fast delivery through the Amazon platform, aiming to compete with rival companies such as Instacart and DoorDash.
However, the service proved too expensive, as Flex drivers were unable to maximize deliveries from local stores versus loading from Amazon warehouses.
About 300 employees have been notified of the closure, with some of them facing layoffs, while others will be transferred to other positions within the company.
During this transition period, merchants are allowed to continue fulfilling orders through Amazon Today until January 24, 2025.
While the service is meant to make it easier for customers to get products right away, the shutdown was forced, and it could have a huge impact on Amazon's relationships with merchants like Office Depot and Petco.
This decision also adds to the list of layoffs at Amazon, which has reached more than 27,000 jobs since 2022, as the e-commerce giant tries to adapt to changing market conditions.
With Amazon now focusing on more efficient delivery options, the big question that arises is: is this the beginning of Amazon's downfall?
Will the increase in layoffs continue, or will the company make smart decisions in the face of the challenges ahead?
