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Coronavirus impact: Amazon guards shelf from disease

Amazon is turning into a case study of how a giant retailer grapples with the fallout from the coronavirus.

New York Times|
Last Updated: Feb 25, 2020, 08.51 PM IST
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Reuters
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With its reliance on Chinese manufacturing, Amazon is turning into a case study of how a giant retailer grapples with the fallout from the coronavirus and what may lie ahead for other stores.
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SEATTLE: What if the Everything Store couldn’t sell everything because of disruptions from the coronavirus?

That’s the situation that Amazon – which typically stocks more than 100 million items, from toilet paper to yoga pants – is working to avoid as the deadly outbreak continues to shut down and slow factories in China that produce the world’s goods. Over the past few weeks, Amazon has responded to the crisis by making larger and more frequent orders of Chinese-made products that had already been shipped to the United States, according to company emails and consultants who work with major brands.

Some of its suppliers have cut back on advertising and promotions on the site so they don’t run out of products too quickly. Amazon also sent an urgent email to brands on Wednesday about Prime Day, its midsummer mega sale, indicating that it has begun worrying about inventory for the event.

And the company has contacted some of its third-party merchants, whose dog leashes, crayons and other products account for about 60% of its sales, to figure out how their flow of goods might be impeded.

“Hello!” read one recent email from Amazon to a seller, which The New York Times reviewed. “We have identified that part of your supply chain process might be China dependent and in light of the coronavirus outbreak effecting manufacturing and logistics in China, we are reaching out to you to understand its impact on your business operations.”

With its reliance on Chinese manufacturing, Amazon is turning into a case study of how a giant retailer grapples with the fallout from the coronavirus and what may lie ahead for other stores. Already dozens of companies have indicated that the virus will take a toll on them, with Apple cutting its sales expectations this week and airlines canceling flights to China.

Retailers have so far said less about how the coronavirus will affect them.

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