An Amazon warehouse reportedly disposes of 130,000 products a week, including new ones. Experts blame its huge third-party retail business.

Workers pack customer orders at the 750,000-square-foot Amazon fulfillment center in Romeoville, Illinois.

Employees pack customer orders at the Amazon Fulfillment Center in Romeoville, Illinois. Scott Olson / Getty Images

  • According to a recent report, an Amazon warehouse in the United Kingdom “destroys” 130,000 items each week.

  • A former worker at the warehouse said half of those items were still in shrink wrap.

  • Retail analysts told insiders why it’s more beneficial for Amazon to junk than to sell them.

  • See other articles on Insider’s business page..

A recent report that the UK’s Amazon warehouse disposes of thousands of products each week reveals that it is closely monitoring its disposal practices.

ITV News A warehouse in Dunfermline, Scotland, reports that 130,000 items are marked per week for “destruction.”Article reflected 2019 France report, It said Amazon had thrown away 3 million items in France in nine months.

One former Amazon employee told ITV that about half of the products marked “destroyed” were new and still shrink-wrapped. Most of the rest are returned and in good condition.

So why is Amazon throwing away new products that are still available for sale?

Patrick O’Brien, a retail analyst at analytics firm Global Data, said it was because Amazon specializes in selling products to third-party sellers.

Most of its retail business comes from the Amazon Marketplace platform. February, analysts Marketplace pulse It is estimated that third-party products will account for $ 300 billion of the site’s total revenue of $ 490 billion in 2020.

“Most of Amazon’s business is going to sell third-party stock,” O’Brien told insiders. “Amazon charges sales commissions, but also various services.” This is a unit for storing items in a warehouse, returning them to sellers, and disposing of unsold items. The cost per is included.

So if the item isn’t for sale on Amazon, the cheapest option is to pay Amazon and get rid of it.

O’Brien said: “The problem for many Amazon sellers is that they face the possibility of continuing to pay rent or having to make a one-time payment for returns if the item doesn’t sell. disposal.”

O’Brien explained that retailers would normally not return merchandise unless they plan to dispose of it. “In that case, it makes more sense to pay Amazon and dispose of it yourself, rather than paying Amazon and having it returned,” he added.

An Amazon spokesman told insiders that “the cost of domestic returns for all products for sellers is lower than the disposal fee,” but these costs are not significantly different.That’s it in the UK 4 cents higher Pay Amazon to dispose of items weighing less than 200 grams (7 ounces) rather than returning the item.

Even if you take into account the additional disposal costs, it may be even cheaper if you let Amazon dispose of it.

The ITV report has gathered negative coverage on Amazon, including activist Greta Thunberg.

“Amazon has a very negative reputation, but it’s important to remember that retailers are responding to the failure to sell their products on their platforms,” ​​O’Brien said. .. Dispose of the item. “

In a statement to insiders at the time, Amazon did not challenge the number of ITVs, but said Dunfermline Warehouse handles the disposal of products throughout the UK. An Amazon spokeswoman said the item would not be sent to the landfill in the UK, but would be recycled and donated. Donations are prioritized.

Dr. Teresado Menek Aparisi, a sustainability expert at the University College London, told insiders that the products sent to the recycling plant could still be incinerated. “Sending nothing to the landfill does not mean that those products are recycled,” she said.

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