{"id":39242,"date":"2025-04-29T11:38:15","date_gmt":"2025-04-29T11:38:15","guid":{"rendered":"https:\/\/quickassetsmarket.com\/index.php\/2025\/04\/29\/amazon-demands-discounts-from-suppliers-as-trump-tariffs-bite-report\/"},"modified":"2025-04-29T11:38:15","modified_gmt":"2025-04-29T11:38:15","slug":"amazon-demands-discounts-from-suppliers-as-trump-tariffs-bite-report","status":"publish","type":"post","link":"https:\/\/quickassetsmarket.com\/index.php\/2025\/04\/29\/amazon-demands-discounts-from-suppliers-as-trump-tariffs-bite-report\/","title":{"rendered":"Amazon demands discounts from suppliers as Trump tariffs bite: report"},"content":{"rendered":"
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Amazon is pressing suppliers for steep discounts and renegotiating contracts to shield its bottom line from fresh US tariffs on Chinese imports, reigniting a playbook last used during Donald Trump\u2019s first term as president, the Financial Times reported<\/a>. <\/p>\n

The Seattle-based ecommerce giant has asked for low double-digit price cuts from vendors across categories such as homeware and consumer electronics, according to three vendor consultants who represent multiple suppliers, FT said. <\/p>\n

The pressure has been especially sharp for suppliers sourcing goods from China, where tariffs of up to 145% have been reimposed by the White House.<\/p>\n

\u201cAmazon is the 800-pound gorilla in the room,\u201d said Scott Miller, a consultant and former Amazon vendor manager. <\/p>\n

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Brands have grown dependent on the platform and have little choice.<\/p>\n<\/blockquote>\n

Amazon revives strategy from prior trade war<\/h2>\n

Amazon\u2019s tactics echo those deployed during Trump\u2019s first presidency, when tariffs on Chinese goods forced retailers to adjust rapidly. <\/p>\n

The company is now using its scale to shift costs down the supply chain, joining big-box rivals like Walmart and Costco in seeking relief from vendors.<\/p>\n

Goldman Sachs analysts estimate the new tariffs could shave between $5 billion and $10 billion from Amazon\u2019s operating profit this year\u2014a decline of 6 to 12% depending on the scope and duration of the trade dispute.<\/p>\n

In a statement, Amazon said it was \u201cworking with our broad, varied range of valued selling partners in our store to support them in adapting to the developing environment while maintaining low prices for customers.\u201d<\/p>\n

Pre-emptive measures: shift in sourcing strategy and tougher terms<\/h2>\n

To mitigate the fallout, Amazon has taken pre-emptive steps, including cancelling large volumes of direct imports from China and advancing shipments ahead of the new tariffs. <\/p>\n

According to two consultants, the company has shifted its purchasing focus to suppliers that already hold stock within the US.<\/p>\n

For non-China imports, Amazon has reportedly been willing to absorb up to a third of tariff costs, which were at 10% during a recent 90-day pause. <\/p>\n

However, such concessions are conditional: Amazon demands fixed-margin agreements, under which vendors must absorb any shortfall if an item sells at a discount.<\/p>\n

\u201cTo their credit, they have been willing to absorb some of the increased costs,\u201d said Miller. <\/p>\n

Jassy signals price hikes, but fights to soften impact<\/h2>\n

Amazon chief executive Andy Jassy acknowledged in a recent CNBC interview that third-party sellers on the marketplace would likely raise prices. <\/p>\n

However, he said Amazon was actively renegotiating supplier contracts to minimise the impact on consumers.<\/p>\n

\u201cThere are some cases where we have deals we negotiated that weren\u2019t done where we\u2019ll renegotiate terms to make it easier for customers to have lower prices,\u201d Jassy said.<\/p>\n

Outlook uncertain ahead of key earnings and Prime Day<\/h2>\n

Amazon, whose shares are down nearly 15% this year, is due to report its first-quarter earnings on Thursday, with investors closely watching for signs of tariff-related margin erosion. <\/p>\n

Analysts are also monitoring the upcoming summer ‘Prime Day’ sales event, traditionally a key revenue driver.<\/p>\n

Eric Sheridan, an analyst at Goldman Sachs, said the event is likely to see more subdued promotions this year. <\/p>\n

\u201cThere will be some costs that have to be borne\u2026 a degree of which is passed along to the consumer,\u201d he said.<\/p>\n

The post Amazon demands discounts from suppliers as Trump tariffs bite: report<\/a> appeared first on Invezz<\/a><\/p>\n

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Amazon is pressing suppliers for steep discounts and renegotiating contracts to shield its bottom line from fresh US tariffs on Chinese imports, reigniting a playbook last used during Donald Trump\u2019s first term as president, the Financial Times reported. The Seattle-based ecommerce giant has asked for low double-digit price cuts from vendors across categories such as <\/p>\n","protected":false},"author":1,"featured_media":39243,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[],"class_list":{"0":"post-39242","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-investing"},"_links":{"self":[{"href":"https:\/\/quickassetsmarket.com\/index.php\/wp-json\/wp\/v2\/posts\/39242","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/quickassetsmarket.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/quickassetsmarket.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/quickassetsmarket.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/quickassetsmarket.com\/index.php\/wp-json\/wp\/v2\/comments?post=39242"}],"version-history":[{"count":0,"href":"https:\/\/quickassetsmarket.com\/index.php\/wp-json\/wp\/v2\/posts\/39242\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/quickassetsmarket.com\/index.php\/wp-json\/wp\/v2\/media\/39243"}],"wp:attachment":[{"href":"https:\/\/quickassetsmarket.com\/index.php\/wp-json\/wp\/v2\/media?parent=39242"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/quickassetsmarket.com\/index.php\/wp-json\/wp\/v2\/categories?post=39242"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/quickassetsmarket.com\/index.php\/wp-json\/wp\/v2\/tags?post=39242"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}