Amazon Fresh Cuts Hundreds of Jobs as Part of Cost Reduction Plan

Amazon.Com, Inc AMZN permanently slashed hundreds of zone lead positions at Amazon Fresh grocery store on Tuesday.

The downsized employees supervised the sections of individual stores in Amazon Fresh locations across cities like Los Angeles, Philadelphia, and Naperville, Ill, the Washington Post reports.

The layoffs were part of a cost reduction plan. Amazon promised to pay the laid-off employees for 60 days.

Amazon is working with affected employees to help them find new roles within the company or apply for other positions or accept severance payments.

Amazon Fresh, launched as a delivery-only brand in 2007, acquired Whole Foods in 2017 and opened physical Fresh stores in 2020.

The company has been reevaluating its expansion and cutting costs, including layoffs in various divisions and projects.

Amazon CEO Andy Jassy has expressed commitment to making the grocery business work but paused new physical Fresh locations' opening for reevaluation.

Job eliminations at Amazon Fresh come amid a year of job cuts in the tech industry, with Amazon having laid off 27,000 workers in 2023.

During the Q4 earnings call, Jassy disclosed halting the expansion of its line of Amazon Fresh grocery stores to evaluate how to make the chain more appealing versus competitors.

Despite cashier-less technology and other innovations, Amazon Fresh has faced challenges getting customers into its stores.

Former employees reported customer confusion and frustration with the technology, leading to lower foot traffic.

Amazon operates 44 Amazon Fresh stores in U.S. cities, including Los Angeles, Philadelphia, and Naperville, Ill. 

Price Action: AMZN shares traded higher by 2.17% at $130.93 on Wednesday.

Photo via Wikimedia Commons

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.