Published 2 years ago.
About a 5 minute read.
With its size and scale and proper follow-through, Amazon has the potential to make a significant dent in global product waste and offer models for other retailers to follow.
Amazon has launched two new Fulfillment by Amazon (FBA) programs
designed to make it easier for its third-party sellers to resell
customer-returned items or overstock inventory, while also giving more products
a second life.
As the ecommerce giant explained in a blog
the programs aim to provide another way for sellers to profit from selling on
Amazon while fueling a circular
fully rolled out, the company expects these programs to give more than 300
million products a second life each year.
— now live in US, Germany, France, Italy and Spain, and soon the
UK — gives sellers the option to use Amazon’s existing wholesale liquidation
partners and technology to recoup potential losses on returned and overstock
Previously, a seller would need to have these items sent back to them or have
Amazon donate the product on their behalf. Now, businesses selling on Amazon
have a hassle-free way to recover some value from returned and overstock items
through selling items in bulk while also doing their part for the environment.
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And sellers who want to resell returned items can utilize the second program,
FBA Grade and
— which is now available in the UK and will be in the US by end of year; and in
Germany, France, Italy and Spain by early 2022. This program gives third-party
sellers the option to sell returned products on Amazon as “used” items, instead
of having the items sent back to them or donated.
“Customer returns are a fact of life for all retailers, and what to do with
those products is an industry-wide challenge,” said Libby Johnson McKee,
director of Amazon WW Returns, ReCommerce and Sustainability. “These new
programs are examples of the steps we’re taking to ensure that products sold on
Amazon — whether by us or our small business partners — go to good use and don’t
become waste. Along with existing programs like FBA
we hope these help build a circular economy, maximize reuse, and reduce our
impact on the planet."
The new programs come less than two months after British broadcaster ITV
that Amazon is destroying millions of items of unsold stock at one of its 24 UK
warehouses every year — including smart TVs, laptops, drones and hairdryers.
The revelation resulted in backlash from UK lawmakers and environmental
campaigners such as Greenpeace — which
Amazon of working “within a business model built on greed and speed.” The group
described the environmental and human cost of Amazon’s wastefulness as
In response, Amazon says it is working toward a goal of zero product waste and
that no items are currently sent to landfill in the UK.
In today’s retail climate, returns account for 50 percent of
purchased in the US alone — and amount to a cost of $350 billion a year, with 5
billion pounds of clothing and textiles winding up annually in US landfills.
Coupled with the fact that over 50 percent of people don’t return products
because the return experience is too cumbersome, this is essentially a $700 billion
And as Greenpeace points out, the practice of destroying unsold stock isn’t new.
Fashion companies have long been known to burn unsold or returned
— even H&M, an early fast-fashion pioneer in textile
was caught in 2017 incinerating tonnes of its unsold
Thankfully, growing consumer awareness of the egregious amounts of products
wasted through conventional retail has ignited growing demand for circular
— and more and more brands, particularly in apparel, are getting on board with
offerings; the secondhand clothing market is expected to top $77
in the next five years.
With its size and scale and proper follow-through, Amazon has the potential to
make a significant dent in global product waste and offer models for other
retailers to follow.
As the two new programs roll out in the US and Europe, Amazon says it has
already received positive feedback from sellers. As US seller SoundPEATS Audio
shared, “We think these programs are helpful for businesses selling on Amazon.
Some sellers, including our business, don't have the third-party warehouse to
easily accept returned inventory or hold on to overstock inventory. Before we
would have to dispose of inventory, but now we’re able to give it a second life
and make money off it.”
These programs are the latest in Amazon’s sustainability initiatives, including
— its commitment to net-zero carbon by 2040 — and its Climate Pledge Friendly
which enables shoppers to easily find certified sustainable products. Amazon is
also committed to giving products a second life through FBA
through which the company says it has helped sellers donate over 67 million
items since its launch in 2019; its discount store for used products, Amazon
the Amazon Outlet store for discounted excess
for refurbished products; and for certified refurbished and used Amazon devices,
Pre-Owned Amazon Devices.
Published Aug 10, 2021 8am EDT / 5am PDT / 1pm BST / 2pm CEST