Technology

In this article

Brendan McDermid | Reuters

Amazon will start charging delivery fees for Fresh grocery orders that are less than $150, in a move it said will help keep prices low on its services.

Beginning Feb. 28, Prime members who want home delivery from Amazon Fresh will incur a $9.95 delivery fee for orders under $50, while orders between $50 and $100 will include a $6.95 delivery fee, and orders between $100 and $150 will carry a $3.95 delivery fee, the company said in a note to customers viewed by CNBC. Only Prime members can use the delivery service, although anybody can shop at an Amazon Fresh grocery store.

Amazon previously guaranteed members of its $139-a-year Prime service free delivery on Fresh orders over $35.

“This service fee will help keep prices low in our online and physical grocery stores as we better cover grocery delivery costs and continue to enable offering a consistent, fast, and high-quality delivery experience,” the notice stated.

The move comes as Amazon CEO Andy Jassy has embarked on a wide-ranging review of the company’s expenses amid slowing sales and a worsening economic outlook. Amazon has eyed laying off 18,000 employees, frozen hiring in its corporate workforce, and paused or canceled some projects such as a sidewalk robot and a telehealth service.

Amazon has previously recalibrated its approach to online grocery deliveries, a business that is notoriously challenging from a cost and efficiency perspective. In 2021, Amazon added a $10 service fee for Whole Foods delivery orders to Prime members, after previously offering them for no extra charge.

WATCH: How Whole Foods has changed in the five years since Amazon took over

Articles You May Like

Chimpanzees’ Task Performance Improves With Human Audience, Study Finds
USMNT shows fight that Pochettino demands as Pepi goal earns edge vs. Jamaica
Amazon debuts discount store with everything under $20 to take on Temu and Shein
Davina McCall diagnosed with rare brain tumour
China’s 3GW Gobi Desert solar farm can power 2 million households