Amazon will reportedly make grocery brands pay for Prime Day losses

Amazon is waiving the Prime Day placement fee to instead charge fees for missed promo sales across grocery stores, a report says.

Corinne Reichert Senior Writer
Corinne Reichert (she/her) grew up in Sydney, Australia and moved to California in 2019. She holds degrees in law and communications, and currently writes news, analysis and features for CNET across the topics of electric vehicles, broadband networks, mobile devices, big tech, artificial intelligence, home technology and entertainment. In her spare time, she watches soccer games and F1 races, and goes to Disneyland as often as possible.
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Corinne Reichert

Amazon could be charging retailers for making losses on Prime Day promo sales.

Angela Lang/CNET

Amazon is reportedly charging some grocery brands an additional fee during 2019 Prime Day if their promotional sales fall short and cause a loss for Amazon. The charge will "fund the profitability gap," CNBC reported Tuesday, citing an email allegedly sent to the retailer's vendors.

Amazon Prime Day is arriving July 15-16 and will see a massive sale on Amazon. 

Watch this: Amazon Prime Day 2019: Everything to know

According to the report, though, Amazon will then waive the usual $500 placement fee to run Prime Day promotions for these grocery brands. 

"This year we've decided not to charge placement fees for inclusion in deal events, but instead we request our vendors to fund a [deal] if it's unprofitable for the duration of the deal," the email from Amazon reportedly said. "If additional funding is required, it will be based off total unprofitable units sold for the duration of the deal."

Amazon didn't immediately respond to a request for comment.

Early Prime Day deals include sales on Amazon Music Unlimited,  Fire TV Recast , the  Echo Dot , the Chamberlain myQ smart garage door opener, the  Amazon Cloud Cam  and  Apple AirPods  with a wireless charging case. Also expected to go on sale are Amazon's full range of Echo speakers, Fire  tablets Fire TV  streamers, Kindle readers and Blink cameras.

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