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Amazon’s Contingency Plans: Pushing Prime Day, Offering Warehouse PPE, Slamming Sellers

The biggest shopping holiday of the year is being postponed due to the coronavirus outbreak—and it’s not Black Friday or Cyber Monday.

Amazon’s ultra-lucrative Prime Day, which usually takes place in July, will be delayed until at least August this year, according to internal meeting notes obtained by Reuters.

The online giant’s decision to delay its international shopping holiday will mean that third-party sellers on the platform will have to wait longer for the blowout shopping event, which they were likely counting on to float them through the season.

“We probably have to promote sooner, which will be difficult if we’re capacity constrained,” wrote Amazon’s general counsel, David Zapolsky, in notes from the meeting with executives. Zapolsky conjectured that the delay could result in a $300 million “worst case” hit to the company’s bottom line, but said a $100 million loss was more likely.

The rollout of the contingency plan may mean that Amazon ends up with a surplus of about five million extra voice-controlled devices, like the Amazon Echo, which would normally be a prized commodity at the mid-summer sale, he said.

While Amazon does not disclose its total revenue from the shopping holiday, last year the company said third-party sellers racked up $2 billion in sales across 48 hours and 18 countries.

According to Reuters, the notes also include critical comments from Amazon’s general counsel about protest organizer Chris Smalls, who was fired on Monday of last week, calling him “not smart, or articulate.” They show that the company is actively assessing business risks due to some of its warehouse workers holding demonstrations to protest health and sanitation measures like the one that Smalls prompted last week.

Perhaps in response to the very public critiques of Amazon’s attempts at corporate responsibility, as well as these unflattering leaks, the company reportedly sent out a text on Sunday to its warehouse workers, detailing new precautionary measures being taken to ensure their safety at work.

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The correspondence, obtained by Business Insider, told workers that their “health and safety is most important,” and recommended that “everyone wears a face mask of some kind covering their nose and mouth from arrival through departure of your shift.”

“We will have face masks in limited quantities for anyone entering the building to wear as a recommended preventative measure, and if you prefer you may bring your own mask, including fabric masks,” the text continued. “We have teams working nonstop to continue sourcing supplies, including masks, and are working hard to stay in stock with masks during this event.”

The text instructed workers to ask their managers or hand-out points of contact for the gear as they start their shifts this week, and directed employees to a Thursday blog post written by the company’s senior vice president of operations, Dave Clark.

Clark wrote that all locations would have masks by early this week, and said disinfectant wipes and hand sanitizer were already “staples” across the company’s fulfillment network.

While the company’s text intimated that a short supply of masks might mean that there weren’t enough for all of Amazon’s 400,000 warehouse workers, a company spokesperson insisted otherwise on Monday.

A PR rep for Amazon told the publication that there were enough masks for all employees across the company’s warehouses and grocery stores to last “a few weeks,” and that it was actively trying to obtain more. They also said Amazon was being “deliberate” in its daily distributions, but did not elaborate on what impact that might have on employees.

In a blog post published Sunday, Amazon said, “The millions of masks we ordered weeks ago are now arriving, and we’re distributing them to our teams as quickly as possible. Amazon Air flights are currently transporting masks across the country to ensure all sites in our operations network have them by early this week.”

Over the past few weeks, Amazon has ignored calls from its employees and government officials to close work sites where workers had tested positive for COVID-19. On Thursday, the company said it would begin checking temperatures at all of its U.S. and European warehouses at the beginning of each shift.

Amazon is also working to quell confusion and disgruntlement within its massive army of third-party sellers.

A week ago, the company received a letter from 32 U.S. attorneys, urging the online marketplace to address price-gouging practices on its platform. According to Business Insider, the company responded quickly with an email to all sellers, announcing a new system for identifying and disciplining those who engage in the practice of raising prices on essential goods during the pandemic.

Rather than creating a one-size-fits-all policy, the company has had to contend with each state’s different price-gouging laws, Amazon said. Some states have concrete rules while others vaguely ban “excessive” price increases without offering a fixed cap, the company said.

That has created confusion among sellers about which of their products are violating the company’s guidelines, which don’t offer much more clarity than the states’.

“We recognize there may be some confusion as to what may trigger offer removal or account suspension for price gouging under this policy,” Amazon reportedly wrote in the message to merchants.

“Our systems attempt to account for these variations in state law while recognizing that the costs of many goods are increasing due to the worldwide effects of the COVID-19 pandemic,” the company added.

Amazon recently said it had suspended nearly 3,900 sellers in the U.S. alone due to violations of its fair pricing policy, resulting in the removal of half a million products.

Amazon representatives did not respond to a request for comment by the time of publication.