Efforts to return Amazon’s Quidsi unit to profitability fail, so hundreds of jobs will be terminated
Amazon has taken the decision to axe hundreds of jobs at its Quidsi division, and will close down the business it acquired in 2011 for $545 million.
Until now Quidsi has been Amazon’s “mom-centric retail technology company” selling baby related products such as nappies, but it seems that Amazon has been trying (unsuccessfully) to turn around the fortunes of the unit for a while now.
The unit, based in New Jersey operates Diapers.com, Soap.com and a number of other websites, all of which will apparently be closed down.
According to a notification sent to the New Jersey Department of Labor, Amazon is to close down Quidsi, and more than 260 employees at its headquarters and customer service operation will lose their jobs in June.
Some of those losing their jobs will be able to apply for positions at Amazon.
“We have worked extremely hard for the past seven years to get Quidsi to be profitable and unfortunately we have not been able to do so,” an Amazon spokeswoman was quoted by Reuters as saying in a statement.
And it seems that some elements of Quidsi will be absorbed into the e-commerice giant. For example Quidsi’s software development team will focus on building technology for the grocery delivery service AmazonFresh, the statement said.
Many believe that the move was a long time coming, and that Amazon is now ready to transfer Quidsi users into the Amazon ecosystem.
Indeed, some e-commerce analysts felt that Amazon probably always intended to eventually eliminate the company and its websites. Amazon’s renewed grocery push is therefore an ideal time to consolidate brands.
“They sucked out any knowledge that team had and now they’ll put it behind the Amazon brand and steamroll those categories,” Allen Adamson, founder of Brand Simple Consulting in New York was quoted by Bloomberg as saying.
Amazon of course is making a big push into the world of online groceries, as it feels that fresh food represents a large and fledgling market for online retailers.
For example in 2015 Amazon began trialling its grocery delivery service in the UK for the first time.
The AmazonFresh service however is still only available in certain areas in the UK.