As part of the annual operating planning review process and the cost-cutting measures, Amazon is closing down its wholesale distribution business in India. Three cities — Bengaluru, Mysuru, and Hubli — operate the distribution vertical. It specialises in purchasing quickly consumable goods from companies and distributing them wholesale to nearby shops like kirana stores, pharmacies, and department stores to support their small businesses.
The U.S.-based internet behemoth is presently implementing cost-cutting strategies in the face of the slowing economy. In light of the enormous layoffs and the worldwide commercial recession, the corporation opted to decrease costs. As part of the annual operating planning review procedure, Amazon stated in one of the media comments that the business will shut down Amazon Distribution, its wholesale e-commerce segment. After December 29, 2022, the service will cease to exist.
Significantly, this is the third Indian operation that the corporation has shut down. The business already stated that it will end its food delivery service, Amazon Food, and ed-tech project, Amazon Academy. In 2020, Bengaluru-based Amazon launched its meal delivery service as a test initiative. Now, on December 29, the service will end. Amazon Academy, the company’s ed-tech division, will be discontinued starting in August 2023. In order to help engineering students get ready for competitive exams like the JEE, Amazon created the Amazon Academy as an online learning platform.
In the meanwhile, the business just let go of almost 10,000 workers worldwide. In a formal statement, company CEO Andy Jassy acknowledged the layoffs and said that they will continue in the upcoming months of 2023. However, not every employee is immediately let go. Employees have been urged to swap teams within a few weeks or to voluntarily leave the organisation by enrolling in the Voluntary Separation Program (VSP)
In accordance with the VSP, employees will receive up to twenty weeks of paid severance in addition to 22 weeks of Base Pay and one week of Base Salary for every six months of service (rounded to the nearest 6 months). The employees will also receive medical insurance coverage under the Insurance Benefit policy for a period of six months, or an equivalent insurance premium in its place. Employees cannot enrol in VSP if they are enrolled in performance improvement programmes (PIP).
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