Amazon says its India business is hit worst by coronavirus pandemic

  • Amazon says it is only delivering essential goods such as groceries, which has hurt its business
  • Amazon said that it hired an additional 175,000 staff, many of whom have been laid off from other jobs

Tarush Bhalla
Updated2 May 2020, 12:05 AM IST
'There's obviously timing differences between countries on when it is hitting certain countries and when it is -- maybe where they are in their curve and flattening their curve and all that,' Amazon vice president and chief financial officer Brian T. Olsavsky said in an earnings call.
’There’s obviously timing differences between countries on when it is hitting certain countries and when it is -- maybe where they are in their curve and flattening their curve and all that,’ Amazon vice president and chief financial officer Brian T. Olsavsky said in an earnings call.(Reuters)

Amazon.com Inc. said its India operations were the worst affected by the covid-19 pandemic as the government ordered the company to halt sales of almost all items but groceries during a 40-day lockdown.

“I think the biggest impact internationally has been in India where, of course, similar to all companies, we’re now only fulfilling essential goods such as grocery; so that’s cut back a lot on our offering and we will further expand when the Indian government announces that we’re allowed to resume operations. So we’re in a bit of a holding pattern, except for grocery in India,” said Brian T. Olsavsky, senior vice-president and chief financial officer, in an earnings call.

In India, e-commerce firms such as Amazon and Walmart-owned Flipkart have been allowed to deliver essential goods during the lockdown that is now extended by two more weeks from 4 May.

These items form a small part of their overall business, which relies heavily on the sale of electronic goods, mobile phones and fashion products. Olsavsky said the covid-19 crisis has played out differently in countries but that Amazon has also noticed a lot of consistency in the types of products that people are buying with the stay-at-home restrictions.

In the earnings call, Olsavsky also said that while Amazon generally has experience in getting ready for a spike in demand for known events such as the holiday season and Prime Day, the covid crisis allowed for no such preparation.

Responding to the health crisis, Amazon has established rigorous safety and cleaning protocols, including maintaining six-foot social distancing, and procuring 100 million masks, and tens of millions of gloves, wipes and other cleaning supplies to prevent contagion.

“We began requiring temperature checks across our operations network, in our Whole Foods stores (in the US) we added plexiglass barriers between cashiers and customers and reserved special hours for senior customers to shop. We temporarily raised wages and overtime premiums, we funded a new Amazon Relief Fund and we allowed employees to take unpaid time off at their discretion,” he said.

To deal with the unprecedented demand, Amazon also said that it hired an additional 175,000 new employees, many of whom have been laid off from other jobs.

The Amazon global network has also pivoted to shipping priority products within one to four days and extending promises on non-priority items, added the Seattle-based e-commerce company.

“We increased grocery delivery capacity by more than 60% and expanded in-store pickup at Whole Foods stores (in US) from 80 stores to more than 150 stores, and other Amazon teams shifted their focus to directly helping customers ,” Olsavsky said.

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First Published:2 May 2020, 12:05 AM IST
HomeNewsIndiaAmazon says its India business is hit worst by coronavirus pandemic

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