Millions of Amazon sellers facing stock shortage as coronavirus keeps factories shut
Millions of Amazon sellers are in danger of running out of stock as the coronavirus outbreak keeps Chinese factories shut down until.
Amazon’s third-party sellers, which accounted for 58 per cent of all goods sold on its platform in 2018, are in danger of taking significant financial hits as their Chinese supply chains are disrupted by the outbreak.
As the number of confirmed cases of coronavirus tops 40,000 and the death toll nudges 1000 Chinese factory workers have been prevented or are have been unwilling to go to work over the past few weeks.
Though the government plans to reopen factories this week, this break has caused many sellers’ stockpiles to deplete, despite many stockpiling ahead of the Lunar New Year Holiday.
Aside from the immediate hit to sales Amazon’s algorithms, which give top listings to sellers with highest and most recent sales, threaten to further impact many sellers.
One seller Bernie Thompson told Reuters that he was in danger of running out of stock my month’s end even if factories reopened this week.
Thompson added that he has largely been unable to reach his suppliers, but those he had managed to contact said they would return this week to a significant backlog of orders.
This backlog is expected to take another two-to-three weeks to clear and delivery to the US.
The outbreak follows months of prolonged tariffs between the US and China which also damaged many sellers’ margins, causing some to eye moving their supply chains to countries like Mexico and Taiwan.