Amazon: good results despite increasing fulfillment cost

Amazon presented good results for 2018 despite increasing cost of fulfillment. Cost, as a percentage of sales, increased from 21% in 2017 to 24% in 2018. In 2011 fulfillment cost were only 11% of sales. US market is profitable, international not yet.

Some other e-fulfillment highlights from the 2018 report:

  • Amazon’s $15 hourly minimum wage went into effect in the U.S. and the U.K. (£10.50 in the London area and £9.50 in the rest of the U.K.) on November 1st for all full-time, part-time, temporary (including those hired by agencies), and seasonal employees. The new Amazon minimum wage benefits more than 250,000 employees in the U.S. and 17,000 employees in the U.K., as well as over 200,000 seasonal employees who were hired this holiday.
  • Amazon announced plans to install solar panels on its fulfillment centers across the U.K., with an installed capacity of 20 megawatts – enough clean energy to power over 4,500 U.K. homes. Currently, Amazon hosts solar panels on 43 fulfillment centers worldwide.
  • During the holiday season alone, tens of millions of customers worldwide started Prime free trials or began paid memberships. More customers signed up for Prime worldwide in 2018 than ever before.
  • Small and medium-sized businesses had their best holiday season ever in Amazon’s stores. More than 50% of units sold in Amazon’s stores this holiday season came from small and medium-sized businesses. Third-party sales are growing faster than first-party sales, and nearly 200,000 small and medium-sized businesses surpassed $100,000 in sales in Amazon’s stores in 2018.
  • Amazon launched Amazon Pop-Up stores to customers in six countries across Europe during the holiday season.

Source: Amazon

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