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Amazon.com Inc. will begin allowing third-party sellers on its platform to resume shipping so-called nonessential items this week, a signal that the company is ramping up to meet broader consumer needs, according to people familiar with the matter.
Last month, Amazon made a decision to prioritize at its warehouses those items deemed essential during the coronavirus outbreak, such as cleaning products, health-care items and shelf-stable food. Amazon stopped accepting shipments of items from sellers that didn't correspond to the shopping needs of consumers hunkering down during the pandemic. The mandate caused unrest for its army of third-party sellers, which account for 58% of Amazon's sales.
Sellers of items unrelated to health, wellness and cleaning will be able to send inventory to Amazon later this week, but there are limits on how much they can ship to ensure there is warehouse space for essential goods, people familiar with the matter said.
Amazon confirmed the plans. "Later this week, we will allow more products into our fulfillment centers," a spokeswoman for the Seattle-based company said. "Products will be limited by quantity to enable us to continue prioritizing products and protecting employees, while also ensuring most selling partners can ship goods into our facilities."
The tech giant has been inundated by orders as Americans follow shelter-in-place guidance to stop the spread of the coronavirus. As a result, its network of warehouses has struggled to keep up, and delivery of orders in its Prime program that previously happened in one day or less has slipped to as long as a month in some cities.
On Monday, Amazon announced that it was hiring an additional 75,000 employees to help fill the mounting demand. Over the past month, the online retailer has hired more than 100,000 people in full- and part-time jobs in distribution centers and across its delivery network in the U.S.
The hiring spree represents almost two-fifths of Amazon's typical U.S. workforce of 500,000. A spokeswoman said the recent hiring is akin to what happens during the holiday period when Amazon adds thousands of temporary workers.
Companies such as Walmart Inc. and CVS Health Corp. have also announced plans to hire hundreds of thousands of additional workers to keep up with consumer-buying practices in the pandemic, even as a broad economic shutdown has brought layoffs for millions of Americans.
Walmart, which is hiring about 5,000 workers a day, has added about 100,000 positions of a previously announced plan to hire 150,000, according to the company
Having additional hires in the warehouses has helped Amazon ease back into handling nonessential merchandise, said one of the people familiar with the matter. The company's hiring frenzy has made it one of the most-active employers during a time when many other companies are laying off their staff.
Amazon's order volume and staffing needs resemble those of the holiday shopping season. Demand for essential items on the website have surged with the onset of the pandemic. Sales of toilet paper, for example, were up 186% from Feb. 20 to March 23, according to analytics firm CommerceIQ.
The company now expects to spend more than $500 million to increase wages for workers, up from a previous forecast of $350 million. Last month, Amazon said it would spend $350 million to temporarily raise wages for employees in the U.S., Canada and Europe. The retailer has also drawn workers to its warehouses by offering new temporary inducements, including $2 hourly increases and double the amount of pay for overtime.
In addition to surging orders, Amazon has dealt with a high volume of worker absences in some warehouses. Many warehouse employees are staying home out of fear of contracting the virus, and some workers have reported recently seeing about half the typical staff at warehouses.
Amazon workers throughout the country have called on the company to close its facilities as dozens of coronavirus cases have popped up in various warehouses. Employees have described unsafe conditions, including working closely alongside each other and not having enough cleaning supplies. Workers in New York, Chicago and the Detroit area have held recent walkouts to protest Amazon's virus response.
Amazon said it is providing face masks to all its facilities and has started daily temperature checks. It also said employees with fevers will be sent home and be paid up to five hours of their scheduled shift that day. Last week, the company said it had started building a lab aimed at testing workers for Covid-19, the disease caused by the virus.
Chief Executive Jeff Bezos posted a video last week of his visit to a warehouse, showing a staffer take his temperature after he entered. He also visited a Whole Foods Market store. Amazon bought Whole Foods in 2017.