The Gulf Time Newspaper One of the finest business newspapers in the UAE brought to you by our professional writers and editors.
Bloomberg
An influential New York Democrat has written to Amazon.com Inc asking about a report that the company plans to cease wholesale orders from thousands of smaller suppliers.
US Representative Nydia Velazquez, chairwoman of the House Committee on Small Business, wrote to Amazon Chief Executive Officer Jeff Bezos asking about the nature of his company’s relationship with small suppliers, whether changes are planned and how much advance notice and support Amazon is giving to businesses that would be affected.
“At a time when many larger companies have overlooked the potential of small firms, I applaud Amazon for inviting small businesses to be wholesale suppliers,†Velazquez said in her letter, which asks Bezos to respond to her questions by June 21.
“I believe that any erosion of your commitment to small firms would be a serious mistake.â€
Bloomberg reported that Amazon was planning to stop placing bulk orders with thousands of smaller suppliers, a move that would reduce the company’s costs and boost profits.
Amazon disputed the report, saying no “large scale†reduction in vendors was planned and that it regularly reviews its supplier relationships on an individual basis. Velazquez cited the story in her letter, seeking clarity from Amazon about its plans. Amazon spooked suppliers when it ceased routine orders from many suppliers without explanation, only to resume later.
“As Chairwoman of the House Small Business Committee, I find these reports deeply troubling as this change could jeopardise small wholesale businesses from continuing to do business with Amazon and affect millions in sales and hundreds of thousands of jobs,†she wrote.
Amazon didn’t immediately respond to requests for comment about the letter.
One of Amazon’s key public relations strategies — selling itself as a friend of small businesses — could unravel if lawmakers decide that it wields too much power in negotiating terms with partners.
The company publishes reports highlighting small business growth and job creation enabled by Amazon and visits lawmakers for private meetings with small business owners
in tow.
An Amazon report sent to elected officials said it helped mom-and-pop companies create 1.6 million jobs in 2018, up from 900,000 the year before. About half of the goods sold on Amazon come from independent merchants.