Business Insider recently reported about leaked emails, which revealed that Amazon is stockpiling products made in China. The report claimed that the e-commerce giant increased its orders last week for some of its products from China. The move could be the company's way of preventing issues with its supply chain considering the recent coronavirus outbreak.
Amazon Stockpiling Made In China Inventories
A recent report from Business Insider revealed that Amazon reached out to its first-party suppliers through email to prepare for potential disruptions in the supply chain because of the global event that originated in China. Amazon reportedly informed its third-party sellers about taking necessary precautions to protect the performances of their accounts. MGA Entertainment CEO, the creator of LOL Surprise dolls, confirmed to the publication that coronavirus was a global crisis and that Amazon was concerned about its impact.
Last week, the e-commerce giant reportedly placed last-minute orders to raise the inventory of its made in China products, reports Business Insider. The move was in anticipation of the potential supply chain disruption that could arise due to the current crisis in the region. In one of the leaked emails, Amazon confirmed that new order was made in China products that would be sold in the US.
The e-commerce giant has all the reasons to be worried about the recent crisis in China. Amazon sources around 40 percent of its sales volume from first-party wholesale suppliers, which are dependent on Chinese factories. Earlier, Amazon told Reuters that the coronavirus outbreak was not causing any interruptions on its operations.
Apple's iPhone Maker Plant Closed By Chinese Govt.
Amazon is not the only company anticipating the negative effect of the coronavirus outbreak on its supply chain. Foxconn, Apple's major iPhone maker, which has several facilities in China, was recently prevented from resuming operations because of several safety and health measures that could put its employees at risk to the coronavirus. Nikkei Asian Review a few days ago reported that Foxconn's Shenzhen and Zhengzhou did not resume operations on Monday because of the order from the Chinese government.
The report claims that one of the sources briefed about Foxconn's plan said that "The local governments do not want to risk the potential virus spreading in such a labor-intensive working environment. No one wants to bear the responsibility of restarting work at this critical moment. Reuters reported earlier today that both plants are now back on track and already resumed their operations.
Foxconn also supplies components for other tech giants like Huawei, Google, and Amazon.
