As CEO Andy Jassy continues widespread cost-cutting measures, Amazon announced it will discontinue several of its private-label brands.
According to The Wall Street Journal, which first reported the news, the company plans to ax dozens of brands, leaving fewer than 20 house labels. The cuts include all but three of Amazon’s 30 clothing labels, leaving just Amazon Essentials, Amazon Collection and Amazon Aware, the line that got the company accused of “greenwashing on a grotesque scale”. Some of the eliminated brands will remain on the company’s site until they sell out.
Related Stories
Amazon also will drop its private-label furniture brands such as Rivet and Stone & Beam, which will also remain on the site until their stock is depleted.
“We always make decisions based on what our customers want, and we’ve learned that customers seek out our biggest brands—like Amazon Basics and Amazon Essentials—for great value with high quality products at great price points,” Matt Taddy, vice president of Amazon Private Brands, said in a statement to The Wall Street Journal.
Amazon also has received criticism from lawmakers who said the company’s house brands could conflict with it selling other national brands. The retailer has also been accused of copying competing products to sell at a lower price under their house brands. In 2018, Williams-Sonoma sued Amazon, claiming it copied a distinctive dining chair made by its West Elm brand.
Amazon has been under investigation by the Federal Trade Commission (FTC) for its practices, and the commission is reportedly preparing an antitrust lawsuit against the company. Corporate representatives are scheduled to meet with the FTC next week prior to the commission filing its suit.
The cuts come as part of a widespread effort to trim costs by the online retailer that include a recent layoff of some 27,000 employees. Amazon also has enacted a hiring freeze and put the brakes on warehouse expansions after slowing revenue growth and a downturning economy have hit the company this year.
Private label brands account for around 1 percent of Amazon’s revenue. Popular products within the discontinued brands will be rebranded under the remaining house labels.
Sourcing Journal reached out to Amazon for comment.
