Destruction of unsold goods more profitable than stockpiling for Amazon

The global e-commerce giant Amazon has been hit with claims that it has destroyed up to three million unsold products from French warehouses over the past year. An investigation carried out by a French television program brought to light the allegation that 300,000 new objects were disposed of over the course of three months at a particular facility. One of the findings of the investigation was that ‘waste’ is financially more efficient than stockpiling unsold products, Euractiv reports.

The conditions for vendors to store their products in Amazon warehouses feature a EUR 26 per three-square meter charge initially, which rises to EUR 500 after six-months and EUR 1,000 after a year.

Environmental NGO Amis de la Terre says that the reason why there is such a large quantity of waste for Amazon is due to issues arising out of a culture of overproduction by which there is a race-to-the-bottom war on prices between global vendors on the website. France is not the first EU country to have unearthed problems related to Amazon’s mass disposal of products. In mid-2018, reports surfaced in Germany of a throw-away culture at Amazon, stating that employees had been quoted as saying they dispose of tens of thousands of new items every day, ranging from fax machines to vacuum cleaners and computers.

In response to the allegations, Amazon came out on the defense saying that the “vast majority” of unsold items are “recycled, resold, returned or donated.” A statement from the e-commerce giant concluded: “We are working hard on continuing to reduce the number of items we have no other choice than destroy.”

The French government reacted vigorously. Brune Poirson, the French state secretary for the environment, said a new French law on the circular economy, currently being finalized, “will ban the elimination of products on marketplaces like Amazon”.

In early January, Amazon overtook Microsoft to become the world’s most valuable publicly listed company with a valuation of USD 797 billion.

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