Amazon is facing serious turmoil due to abrupt changes in international trade policy, according to leaked internal correspondence obtained by Business Insider. The company is urgently seeking ways to reduce costs, including relocating production, revising contracts with suppliers, and even risking price increases for consumers.
So, what happened as a result? A sharp increase in tariffs on imports of goods from China and Southeast Asia (in some categories — up to 25-40%). New restrictions on the import of electronics, textiles, and household appliances into the USA and EU. Pressure on suppliers: Amazon requires partners to reduce purchase prices in order to compensate for duties.
In one of the letters, an Amazon Logistics top manager admits: "We don't have time to adapt. If we don't find workarounds, it will hit margins and delivery speed."
What solutions are Amazon considering now? Relocating production to countries with preferential tariffs (India, Mexico, Vietnam). Pressure on sellers: requiring sharing costs or changing supply schemes. Warehouse robotization — speeding up cargo processing to reduce costs. Price increases — an extreme option that could affect buyers.
Amazon is losing $1-2 billion in quarterly profit due to new duties (UBS analysts' estimate). Millions of products on the marketplace are under threat, especially electronics and clothing. Competitors (Walmart, Shein, Temu) are already restructuring supply chains, increasing pressure.
Experts predict the following. Temporary disruptions in delivery (especially for goods from China). Hidden price increases — through reduced discounts or commissions for sellers. Accelerated investment in local production (e.g., 3D printing in warehouses).
The trade war is hitting retail, and Amazon, despite its power, is forced to play catch-up. Buyers should prepare for less favorable deals, and sellers — for tough negotiations.
Now on home
