COVID-19: Supply chain updates


May 22: Shopify announced a partnership with Facebook to help businesses launch branded Facebook shops, a new and free tool helping merchants create a customized online storefront for Facebook and Instagram. At the same time, Walmart has quietly announced that it is discontinuing Jet.com after reportedly seeing a loss of $2 billion in the division in 2019. The question that remains is whether it can continue to grow its e-commerce business, and reduce losses, by utilizing its giant stores for dual-purpose: continue to push its brick-and-mortar strategy and serve as fulfillment centers for e-commerce orders.



May 19: Amazon reached an agreement with workers’ unions in France to reopen all six of its distribution centers, complying with health and safety measures, after a one-month shutdown.


More info: On April 16, the French court ruled that Amazon must increase safety measures to better protect workers against COVID-19 or face fines for shipping nonessential items. Amazon appealed the ruling and lost.



May 13: American-Canadian nonessential travel restrictions are still in place, however essential and commercial goods are continuing to cross borders in both directions. This policy on people vs trade restriction is similar to other travel bans around the world, which, in general, continue to allow goods to flow between countries. More info: Canadian Prime Minister Justin Trudeau is currently working with the US government to determine whether to keep the border closed to nonessential travel as the mutual border agreement is set to expire on May 21.


May 8: The United States Postal Service is temporarily suspending international mail acceptance for certain destinations due to service impacts related to the COVID-19 pandemic. More info: This update follows a USPS warning that the COVID-19 pandemic has caused a decline in business and is threatening its survival.

According to the press release, USPS said “It is estimated that the COVID-19 pandemic will substantially increase the Postal Service’s net operating loss over the next eighteen months, threatening the Postal Service's ability to operate”.

Click here for full list of suspended locations.



April 29: The US government issued an executive order, under the Defense Production Act, declaring meat processing plants are critical infrastructure and mandating they stay open. This order comes on the heels of a letter John Tyson, Chairman of Tyson Foods Inc, wrote to the public warning that the US “food supply chain is breaking” and we should expect to see a limited supply of their products in stores until they are able to reopen. Last week they closed 2 pork processing plants and a beef facility as the virus has spread throughout plant workers. Other meat processors, like JBS USA and Smithfield Foods, have recently closed facilities too. More info: The plant closures could hurt the supply chain at both ends: farmers (supply-side) across the nation will not be able to sell their livestock to be processed and consumers (demand-side) won’t be able to purchase meat.


April 21: Amazon will extend its shutdown in France through at least Friday, as the company waits on appeal decision. According to a statement from Amazon, “The company will reevaluate its position once the court ruling is given on Friday (4/24)”. It added that employees will continue receiving their full salary.

Some context: Amazon’s temporary shutdown in France was originally supposed to last five days, through Monday 4/20, as the company carried out an assessment of “occupational risks inherent in the COVID-19 epidemic” in all of its warehouses.



April 20: In an issue ordered yesterday, the Ministry of Home Affairs in India reintroduced a ban on delivery of ‘non-essential’ items by e-commerce companies like Amazon and Flipkart until May 3.

Some context: That reverses a decision to lift the restriction last week, when the government allowed e-commerce companies to deliver ‘non-essential’ items. E-commerce companies are still allowed to deliver groceries and other essential items.



April 17: Airlines are beginning to use passenger aircrafts to transport cargo rather than people: Some airlines are placing cargo on seats and others retrofitting planes by removing the seats entirely. These types of changes usually require manufacturer and certifying authority approval (reviewing weight balance, fire suppression, etc) which can take months to complete, but given the urgency of the COVID-19 crisis, Boeing has cleared local authorities to make a final decision. The airline operator retains the final responsibility.

Some context: This idea isn’t new: In normal times about half of the worlds air cargo is transported in the bellies of planes, however using the cabin is something entirely different. It is estimated that air cargo accounts for about 35% of global trade by value (only about 10% of volume).



April 16: Following a court ruling, Amazon will temporarily shut down operations in France for five days in order to “enhance safety measures” in six warehouses and will furlough 10,000 workers with full pay during that time.


Some context: Amazon has seen a surge in demand as more people stay home and has recently come under scrutiny over its health and safety measures.



April 15: French court orders Amazon to reduce its local delivery to only essential goods and assess “occupational risks inherent in the COVID-19 epidemic” in all of its warehouses. In response, Amazon may suspend all of its in-country fulfillment activity and expects to appeal the ruling.



April 14: US food supply chains are strained at both ends: Decreased production capabilities due to sick and fearful staff and increased panic-buying customers. Amazon announced that it will begin to receive ‘non-essential’ items later this week.


April 13: Amazon hired 100k employees last month to meet increases in demand and just announced plans to hire another 75k, along with a pay increase. Walmart has aimed to hire 150k employees and Instacart 300k.


April 12: Amazon announced that new customers seeking online grocery delivery from Whole Foods or Amazon Fresh would be put on a wait-list.



April 6: Amazon’s ‘non-essential’ receiving freeze still seems to be in effect, although there hasn’t been an official announcement (Was supposed to remain in effect until April 5). Amazon is also extending returns until May 31 for goods purchased between March 1 and April 30.



April 3: Amazon is reportedly delaying Prime Day until at least August.



March 31: Amazon changed their ‘Buy Box’ algorithm to give preference to merchants who expect to be able to fill the order fastest.



March 17: Amazon notified it’s US and EU sellers that it would freeze all ‘non-essential’ inbound shipments into their FBA warehouses (Citing that it would be in effect until April 5).