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How Coronavirus Could Slow Down Amazon Deliveries

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The stay-home surge just broke Amazon’s delivery machine.

With grocery shelves emptying and states ordering residents indoors, Amazon is buckling under a flood of online orders it never planned for. Delivery windows are stretching out, popular items are showing “currently unavailable,” and the company is now scrambling to hire tens of thousands of workers just to keep packages moving. For the small businesses that sell through Amazon’s warehouses, the fallout is just as serious as the shortages themselves.

• Amazon is keeping roughly 110 U.S. fulfillment centers running even after confirmed coronavirus cases among warehouse staff.
• The company announced on March 16, 2020 that it would hire 100,000 new full- and part-time workers and raise hourly pay by $2 through April, backed by more than $350 million in wage increases.
• Amazon has cut off warehouse intake for anything outside household staples, medical supplies, and groceries — freezing out third-party sellers of non-essential goods.

A Warehouse Network Under Strain

As millions of Americans were told to stay indoors in mid-March, Amazon’s ordering volume spiked far beyond anything its logistics network was built to absorb. Delivery delays followed almost immediately, along with out-of-stock notices on everything from disinfectant wipes to pantry staples — the same items disappearing from physical store shelves as shoppers stocked up amid the outbreak.

Amazon has continued running its roughly 110 U.S. fulfillment centers even with confirmed positive coronavirus cases among warehouse employees, betting that keeping the network open outweighs the risk of shutting facilities down while consumer demand for essentials is at its peak.

100,000 New Hires and a Pay Bump

To close the gap between order volume and delivery capacity, Amazon announced on March 16 that it would add 100,000 full- and part-time positions across its U.S. fulfillment centers and delivery operations. Amazon Worldwide Consumer CEO Dave Clark’s team is directly courting workers laid off or furloughed from restaurants, hotels, and travel companies — industries that have been gutted by the same pandemic driving Amazon’s order surge.

The company is backing the hiring push with more than $350 million in temporary wage increases: an extra $2 an hour in the U.S., pushing base pay to $17 or higher, plus C$2 in Canada, £2 in the UK, and €2 across several European markets, all running through April.

Sellers Locked Out of Their Own Inventory

The most immediate casualty of the crunch has been Amazon’s third-party seller base, which accounts for more than half of everything sold on the marketplace. Amazon’s emergency prioritization policy restricts warehouse intake to household staples, medical supplies, and groceries, which means sellers of anything else can no longer ship new inventory into Fulfillment by Amazon centers at all.

Sellers deemed non-essential saw their business simply stop — while others were already stuck with inventory stranded in Chinese factories from earlier in the outbreak.

For sellers whose products don’t qualify as essential, that’s an effective shutdown of new stock going in, even as existing listings stay live. Others are caught in a second squeeze: factories overseas closed or slowed during earlier lockdowns, leaving inventory stranded before it ever reached a U.S. warehouse. The result is a marketplace where some sellers can’t restock and others can’t even get product out of the country. Shoppers browsing for cleaning supplies or masks are running into the same shortages that have hit brick-and-mortar stores under stricter state-by-state coronavirus restrictions, and the squeeze on basics is showing up elsewhere too, with grocery prices already climbing as demand outstrips supply.

Amazon’s fix right now is essentially triage — protect the essentials pipeline, throw money and headcount at the fulfillment side, and let everything else wait. Whether that holds depends on how long the order surge outpaces the 100,000 new hires Clark’s team is racing to bring on through April.