Brendan McDermid | Reuters
Amazon will start charging delivery fees for Fresh Wholesale orders that are less than $150, in a move he said will help keep prices low in the service.
Starting February 28, Prime members who want home delivery from Amazon Fresh will be charged a $9.95 delivery fee for orders under $50, while orders between $50 and $100 will include a $6.95 delivery fee, and orders between $ 100 and $150 will carry a $3.95 delivery fee. , the company said in a note to customers viewed by CNBC. Only Prime members can use the delivery service, although anyone can shop at Amazon Fresh grocery stores.
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Amazon previously guaranteed members of its $139 Prime service a year for free on fresh orders over $35.
“This service fee will help maintain low prices at our online and physical grocery stores as we cover wholesale shipping costs and continue to provide a consistent, fast, and quality delivery experience,” the release said.
The move comes as Amazon CEO Andy Jassy has begun a review of the company’s costs amid slowing sales and a worsening economic outlook. Amazon has laid off 18,000 employees, hired company employees, and paused or canceled several projects such as sidewalk robots and telehealth services.
Amazon has previously recalibrated its approach to online grocery delivery, a business that is notoriously challenging from a cost and efficiency perspective. In 2021, Amazon is adding a $10 service fee for Whole Foods delivery orders to Prime members, after offering it at no additional cost.
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