Brendan McDermid | Reuters
Amazon will begin charging a delivery fee for Fresh grocery orders under $150, which it says will help keep service prices low.
Starting February 28, Prime members who want home delivery from Amazon Fresh will be charged a $9.95 delivery fee on orders under $50, while orders between $50 and $100 will include the fee for $6.95 shipping, and $3.95 shipping on orders between $100 and $150. , the company said in a note to clients seen by CNBC. Only Prime members can use the Amazon Fresh delivery service, although anyone can shop at the Amazon Fresh grocery store.
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Amazon previously guaranteed members of its $139-a-year Prime service free shipping on fresh orders over $35.
“This service charge will help keep prices low in our online and physical grocery stores as we better cover product shipping costs and continue to provide consistent, fast and quality delivery,” it said.
The move comes as Amazon CEO Andy Jassy launches a sweeping review of the company’s spending as it braces for slowing sales and a worsening economic outlook. Amazon plans to lay off 18,000 employees, freeze corporate hiring and suspend or cancel some projects, such as a robotic sidewalk and telemedicine service.
Amazon has previously calibrated its approach to online product delivery, which is notoriously difficult in terms of cost and efficiency. In 2021, Amazon added a $10 service fee for Whole Foods delivery orders to Prime members, after previously offering them at no extra charge.
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