Cross-border e-commerce sellers are experiencing turbulent times as Amazon makes significant changes to its logistics operations. The e-commerce giant recently announced the suspension of air freight services between China and key Western markets, adding to existing warehouse operational challenges that are causing delays across the supply chain.
Amazon Logistics "Streamlining": Air Freight Services Halted
Amazon Global Logistics (AGL) unexpectedly suspended cross-border air freight services from mainland China and Hong Kong to the United States and Europe. The suspension affects all AGL air freight options including "FBA Air Freight," "FBA Air," and "Z-Parcel Official Small Package" services, with the final booking date set for February 6, 2023.
While the air freight suspension has caused concern among sellers, ocean freight services remain operational, providing some relief to businesses reliant on Amazon's logistics network.
AGL primarily serves marketplace sellers using Fulfillment by Amazon (FBA) services in the United States, Europe (UK, Germany, France, Italy, Spain), and Japan. The move has sparked speculation about Amazon's strategic shift in logistics, with some industry observers suggesting the company may be focusing more heavily on ocean freight operations.
Workforce Reductions: Warehouse Operations in Crisis
The logistics changes coincide with Amazon's massive workforce reductions, which began earlier this year with over 3,000 employees receiving layoff notices across New York, California, and Washington state. The staffing shortages are creating significant operational bottlenecks at fulfillment centers:
- LAX9 facility: Drivers waited over 24 hours for unloading appointments
- SMF3 warehouse: Equipment failures interrupted mid-process unloading
- GYR3 location: Queue times exceeded capacity with 30+ trucks waiting
Industry sources confirm that labor shortages—not inventory overload—are causing the operational delays. The workforce reductions have exacerbated existing staffing challenges, leading to slower processing times that some sellers say began during the 2022 holiday season.
Rising Costs: Amazon's Profit Protection Measures
The operational changes occur against a backdrop of increasing fees across Amazon's seller services. The company has implemented successive increases in fulfillment, storage, and advertising costs over the past year as part of broader profitability measures.
Differential Impact: Seller Size Matters
The operational disruptions affect sellers differently based on business scale:
- Enterprise sellers: Minimal impact due to multi-platform diversification
- Mid-market sellers: Significant challenges from FBA dependency
- Small businesses: Profitability pressure from rising fee structures
Strategic Responses for Sellers
Facing these challenges, sellers must adapt their operations through several key strategies:
- Platform diversification: Reducing reliance on Amazon through alternative marketplaces
- Inventory optimization: Implementing more sophisticated stock management systems
- Logistics alternatives: Evaluating third-party logistics providers
- Operational efficiency: Enhancing listing quality and conversion optimization
- Policy vigilance: Monitoring Amazon's evolving operational requirements
For warehouse-specific challenges, sellers should prioritize early appointment scheduling, strategic facility selection, and thorough documentation preparation to minimize delays.
Long-Term Adaptation Strategies
Forward-looking sellers are exploring additional channels for business resilience:
- Developing independent e-commerce properties
- Expanding social commerce initiatives
- Implementing content marketing strategies
- Establishing affiliate marketing networks
As Amazon continues to refine its operations, sellers must balance immediate tactical responses with longer-term strategic planning to navigate the evolving e-commerce landscape.