There’s a story breaking this morning about Amazon destroying “millions of new items it can’t sell”. While there is some truth to the story, Amazon’s actions are being taken so far out of context that you’re not getting the complete story.
Once I explain the context you’ll understand why I think the more accurate title for this breaking story should be “Amazon France follows retail industry SOP”.
Undercover investigators secretly filmed the waste in one of the online retail giant’s enormous warehouses in France, and the practice is reportedly followed in the UK.
Reporters disguised as Amazon workers covertly recorded staff hauling lorry-loads of unused kitchen equipment, flat-screen televisions and other goods into skips to be sent to dumps.
Cameras fitted to a drone also followed an Amazon truck filled with expensive items as it drove from a warehouse to a landfill site.
This sounds terrible, yes, but –
Since the story is coming from The Daily Mail, one cannot simply trust the story without verifying it, which is why the first thing I did this Sunday morning was go look for the original source to confirm whether it was credible, and to see if The Daily Mail was reporting the story accurately.
It turns out The Daily Mail was no more or less accurate in its reporting than its source. This story was originally reported by the French tv channel M6 in early January, and then picked up by a few French language sources like RTL. I have not found the original source yet, but I did find a couple follow up pieces, including a response from Amazon.
It seems Amazon does destroy products, and one reason they do so is taxes:
Regarding the donations of third-party sellers in the marketplace, the current VAT regulations require sellers to pay VAT on donations, which is not economically viable.
Edit: Also, as Scott points out in the comments, Amazon was not destroying their stock, but that of marketplace retailers who don’t want to keep paying for Amazon warehouse space, and don’t want to pay for shipping to get the stock back.
This got me thinking, and I realized this is a pretty standard practice that goes back decades.
To give you a couple examples, my mother recalls working with a charity in the 1980s and getting calls from K-mart employees who had violated policies to destroy unsalable merchandise. Instead, the employees would put the merchandise (clothes, in this case) in bags _next_ to the dumpster so the charity could pick it up.
Not only that, but book publishing has followed a similar practice for about 80 years now called “remainder”. Whenever a bookseller ripped a cover off to return it for credit, they are doing on a small scale what Amazon is doing on a large scale.
So really, Amazon is just doing the exact same thing as everyone else.
The real story here, folks, is that it sometimes makes more business sense to destroy products than to sell them. Alas, that detail isn’t quite as clickbaity as a video of the products being destroyed, so it is frequently left out of this kind of story.