Amazon Flex driver Ricardo Escalona works to deliver his same-day orders during Cyber Monday from an Amazon fulfillment center on November 27, 2023 in Tampa, Florida.
Octavio Jones Getty Images News | Getty Images
Amazon is shutting down a service that offers same-day delivery from mall and brick-and-mortar retailers, CNBC has learned.
The company has halted any new development of the service, called Amazon Today, and will begin phasing it out, according to two people with knowledge of the matter. These people asked not to be identified because they are not authorized to speak to the media.
A large part of the program will be closed on December 2, the people said. Select retail partners will be able to continue fulfilling orders through Amazon Today until Jan. 24, Amazon told CNBC.
A small number of employees will be laid off and offered layoffs and others will be transferred to other positions within Amazon, the company said.
Employees working at Amazon Today learned the news at a meeting on Monday, where some employees were told they would be laid off, the people said. About 300 employees were working on Amazon Today, the people said.
The closure of Amazon Today is the latest example of the company’s cost-cutting efforts.
As of 2022, Amazon CEO Andy Jassy has been on a company-wide cost-cutting drive to meet the rapidly changing corporate environment. From 2022 to 2024, Amazon began the largest layoffs in its history, cutting more than 27,000 jobs. Jassy took a harder line on the company’s unproven, expensive bets than his Amazon predecessor Jeff Bezos. Jassy has launched a number of projects, including a telehealth service, a video calling device for children and a mobile Treasure truck.
Founded in 2022, Amazon Today allows Amazon sellers to offer fast delivery to their brick-and-mortar stores and supermarkets in select cities. Amazon’s contracted Flex drivers, who deliver goods using their own vehicles, pick up packages and deliver them to customers’ doorsteps within hours of orders being placed.
Amazon Today was part of the company’s drive to get online shopping to consumers’ doorsteps at a faster pace. Amazon continues to add more centers that focus on same-day delivery in an effort to improve sales and compete with other companies that offer fast delivery. That includes Instacart and DoorDash, which expanded beyond food and groceries and into retail.
The company has signed many sellers to Amazon Today, according to the program’s website. That list included Office Depot, Staples, PetcoPacSun, the vitamin and dietary supplement chain GNC and Fabletics, the sportswear brand owned by actress Kate Hudson.
Amazon is working with merchant partners who have signed up for the service to ensure a smooth transition for them, the company said. Amazon added that it continues to prioritize and invest in fast delivery.
The decision to close Amazon Today comes as a surprise as Amazon has been busy onboarding other retailers, one of the people said. The company also introduced the program to many retailers at a conference last week.
The service is more cutting-edge than traditional delivery routes where Flex drivers can fill their cars with packages from an Amazon warehouse, one of the people said. Amazon Today’s routes, which the company calls “store deliveries,” often didn’t fill a driver’s seat, making the program less profitable for Flex contractors.
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