Amazon.com Inc. will discontinue some of its operations in India, demonstrating that Chief Executive Officer Andy Jassy's cost-cutting drive is having an impact on even this important growth region with its 1.4 billion people.
The business announced that it is discontinuing bulk doorstep delivery of packaged consumer goods to small businesses as well as meal deliveries. According to a person familiar with the situation, just a small portion of Amazon's thousands-person workforce will be laid off as a result of the exits, leaving the company to rely on its core businesses like online retail in the nation.
Amid sluggish growth in a number of Amazon's business segments, Jassy is cutting costs and employment opportunities globally. According to Bloomberg, the slowdown in India highlights Amazon's difficulties in one of the world's fastest-growing e-commerce countries, where it must contend with regulatory pressure, domestic conglomerates Reliance Industries Ltd. and Tata Group, as well as Walmart Inc.'s Flipkart, and fierce competition. Despite investing billions of dollars in everything from payments to grocery delivery over the past ten years, the corporation has not been able to establish the kind of market dominance it has in countries like the US.
The person, who requested to remain anonymous because they were discussing internal deliberations, also predicted that some projects that were in beta testing would be shelved. In the upcoming months, Amazon will shut down its Amazon Academy learning platform, which provides online exam preparation materials for students vying to get into India's engineering and medical schools, Indian Express reported.
The individual predicted that only a small portion of Amazon's roughly 10,000-person India e-commerce staff would be lost, or only a few low-hundreds of jobs. In total, Amazon employs more than 100,000 individuals full-time in the nation to support its international operations.
The company has come under fire from a labour organisation representing IT workers for making what it refers to as "voluntary separation" offers and allowing workers only a short period of time—until December 6—to make a decision.
There is no union at Amazon itself.
According to people familiar with the situation, Amazon wants to reduce around 10,000 positions globally, which would be its biggest-ever staff drop. For the holiday quarter, it has forecast the smallest revenue growth ever. Jassy had also frozen hiring for some corporate positions and terminated several smaller and experimental programmes.
In India, Amazon introduced Amazon Food in 2020, the food delivery service it is now discontinuing. It provides a variety of meals from restaurants and other suppliers, including paratha-stuffed bread and McDonald's hamburgers and fries. Despite no longer offering door delivery of packaged consumer items, Amazon's business-customer segment will continue to supply small shops and bulk customers with goods like groceries and medical supplies.
"We are discontinuing these programs in a phased manner to take care of current customers and partners," the company said in an emailed statement. "We remain committed to India and will continue to invest across those areas where we can bring value to our customers."
Over the past ten years, Amazon has added millions of new merchants to its platform in India, expanded into new markets like groceries and digital payments, and increased its sales of apparel, cosmetics, and travel services. The company stated that its main areas in India will include grocery, consumer electronics, fashion, and business-to-business goods.