January 18, 2020 Real Estate Publication

Amazon blames holiday delivery delays on winter storms and high demand

A United Parcel Service delivery driver carries Amazon.com packages in Brooklyn, N.Y.

Victor J. Blue | Bloomberg | Getty Images

Amazon‘s massive delivery infrastructure is experiencing some hiccups as the holiday shopping season continues. The company said that it is experiencing shipping delays as it faces high demand and winter storms this holiday season. Recode first reported the news Thursday.

“We are off to a record-breaking start to the holiday season and on peak shopping days, delivery promises vary and may be longer than normal based on order volume and the fulfillment and delivery capacity available in a given area,” a spokesperson wrote in an email to CNBC. “The winter storms that swept across much of the country at the same time also extended delivery times in some areas. We will work directly with customers who are experiencing an issue with their delivery.”

The delays come after Amazon started offering one-day delivery on items for Prime members. The company has spent at least $800 million this year to expand the program.

Recode reported Thursday that complaints about shipping delays started piling up this week on social media, like in the comments on the post below.

Amazon’s free and fast delivery for Prime customers has set the company’s retail business apart from legacy retailers that haven’t matched Amazon’s huge investments in delivery infrastructure. Traditional retailers are now fighting back to establish competitive e-commerce presences of their own.

Walmart has been aggressively investing in its e-commerce platform and speeding up its delivery to match Amazon’s promises. Walmart does not charge a membership fee. And Nike pulled its merchandise from Amazon last month as it pursues a more personal relationship with customers. Amazon Prime signups are now dropping, according to surveys by retail analytics firm First Insight. Earlier this year, the firm said it found 52% of survey respondents were Prime members in 2019, down from 59% a year earlier.

This holiday season is the first year that Amazon will take on some of the busy months without one of its major delivery partners. Fedex ended its ground-delivery contract with Amazon in August this year. Amazon will now rely on its other delivery partners like UPS and its own Amazon Logistics delivery network.

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