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Amazon reportedly pays premium for Prime members to pick up packages

Amazon building
Prime members may collect payment for picking up their deliveries.

Media reports indicate Amazon is providing a financial incentive for some Prime shoppers to forgo delivery of their orders.

According to Reuters, the e-tail giant has been emailing an “unknown number” of Prime members with an offer of $10 to pick up Prime shipping orders worth $25 or more at established pickup locations, such as Kohl’s or Amazon Fresh stores. Amazon declined comment.

In April 2023, Amazon instituted a policy that customers dropping off purchases made on its e-commerce site for return at UPS Store brick-and-mortar locations will be assessed a $1 fee if there is a Whole Foods, Amazon Fresh, or Kohl’s store closer to their delivery address.

Read more coverage here.

Amazon reduces corporate costs

Presumably even with the $10 incentive, Amazon will save last-mile delivery costs, which can account for half of total shipping cost, through this program. Amazon has been identifying items that are frequently returned on its website in recent months, and the retailer has been initiating a variety of cost-cutting measures as e-commerce volumes fall from their peak pandemic levels.

Amazon recently reported better-than-expected fourth-quarter sales, but a loss on its stake in electric-truck maker Rivian Automotive took a big bite out of its profits. The online giant also warned of slower growth for the short term, with CFO Brian Olsavsky saying on a call that the company expects slower rates for the next few quarters amid an uncertain economic environment. 

In November 2022, Amazon publicly announced it has decided to “consolidate” some teams and programs in the devices and services organization (responsible for product lines such as Amazon Echo and Kindle devices). The company also announced a voluntary reduction offer for some employees in its People, Experience, and Technology (PXT) organization. As a result, Amazon said an unspecified number of jobs are being eliminated.

At the beginning of 2023, Amazon said it plans to eliminate just over 18,000 roles in 2023, with the majority of eliminations in its Amazon Stores and PXT organizations. The company is also closing eight Amazon Go convenience store locations and has phased out its Amazon Smile program that lets customers make charitable donations through their purchases.

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