Why Amazon Blames The USPS For Fresh Problems

So, what went wrong with AmazonFresh?

That was the question on everyone’s keyboard last week when it came out that Amazon had decided to pull the plug on its Fresh Delivery program in nine states — particularly because it did so suddenly and without explanation.

According to internal sources reported on by Recode, the issue wasn’t with AmazonFresh itself, but the United States Postal Service, which was the deliverer of choice to the areas where Fresh service was discontinued. Specifically, Amazon has been telling food brands that the USPS frequently delivered late or not at all — and for lack of a better fresh food delivery option, Amazon was forced to pull the plug.

Amazon also noted that the economics of the business didn’t work as neatly in the areas where Amazon shut the service down — likely due to lower population density.

Amazon’s upper and warehouse management seem to be aligned on this point, since Fresh warehouse managers concurred that the USPS was key to the decision to pull back Fresh in some locations, noting that Amazon had also feared being hit with new fees and that the postal service was fairly recalcitrant on issues like shipping using paper instead of plastic bags.

An Amazon spokeswoman declined to comment; the post office’s only comment was to refer journalists to Amazon.

AmazonFresh has been around for over 10 years — since 2007 — but grocery has been a slow-going effort. The relationship with the USPS began in 2014 in the San Francisco area and won approval for a multi-year grocery delivery test from there.  The postal service also instituted Sunday deliveries of non-grocery packages for Amazon several years ago.



The How We Shop Report, a PYMNTS collaboration with PayPal, aims to understand how consumers of all ages and incomes are shifting to shopping and paying online in the midst of the COVID-19 pandemic. Our research builds on a series of studies conducted since March, surveying more than 16,000 consumers on how their shopping habits and payments preferences are changing as the crisis continues. This report focuses on our latest survey of 2,163 respondents and examines how their increased appetite for online commerce and digital touchless methods, such as QR codes, contactless cards and digital wallets, is poised to shape the post-pandemic economy.