As part of its annual operating planning review process and cost-saving measures, Amazon is closing its wholesale distribution business in India. There are three distribution centers in Bengaluru, Mysuru, and Hubli. In order to support small businesses, the company purchases fast consumable products from businesses and distributes them wholesale directly to kirana stores, pharmacies, and department stores.
The U.S. tech giant is currently working on cost-cutting measures amid the economic slowdown. After the mass layoff, the company decided to reduce costs around its global business amid the economic slowdown. According to one of the company’s media statements, Amazon Distribution, its wholesale e-commerce division, will be discontinued as part of the annual operating planning process. The service will no longer operate from December 29, 2022.
Significantly, it’s the third business the company has closed in India. Earlier, the company announced it would discontinue its food delivery service- Amazon Food and its ed-tech venture- Amazon Academy. The Amazon food delivery service was started in 2020 as a pilot project based in Bengaluru. The service will now stop on December 29. Meanwhile, the company will discontinue its ed-tech segment, Amazon Academy, from August 2023. Amazon started Amazon Academy as an online learning platform for engineering students to prepare for competitive exams like the JEE.
Meanwhile, the company recently laid off around 10,000 employees from its global workforce. Company CEO Andy Jassy in his official statement confirmed the layoffs and announced that the firings will continue in the coming months of 2023. All employees are not fired directly, however. The company has asked its employees to switch teams within a few weeks or has asked them to voluntarily resign by signing up for the Voluntary Separation Program (VSP).
According to VSP, employees will receive 22 weeks of Base Pay, a week of base salary for every six months of service (rounded to the nearest 6 months), and up to twenty weeks of paid severance. Additionally, employees will also receive medical insurance coverage for 6 months under the Insurance Benefit policy, or equivalent insurance premium amounts in lieu thereof. However, if employees are under performance improvement programs (PIP) they will not be able to sign up for VSP.
