Amazon Web Services, the cloud unit of Amazon recently revealed about the negative impact of drone strikes on its facilities in Bahrain and the United Arab Emirates amid the conflict of Middle East.
The problem has come after a few hours the cloud-computing facilities of the company in the UAE and surrounding Middle East countries faced connectivity and power failure problems after drones (unidentified objects) struck their UAE-based data centers. However, it is not a single impact Amazon is currently facing from the war in Iran and its effect on other Gulf countries.
Amazon Suspended Deliveries and Closed Fulfillment Centers in Abu Dhabi
The latest report revealed that Amazon has recently closed its Abu Dhabi and other UAE-based fulfillment centers/warehouses while suspended many deliveries across the respective regions. Accordingly, the e-commerce giant is responding to the increasing instability in the entire Middle East region that has led to ripples across different parts of the world, especially in the UAE and surrounding countries.
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Internal Memo Update for Employees and Stakeholders by Amazon
This week, Amazon team also shared an update related to closure of its warehouse facility to its stakeholders and employees in an internal memo. As a result of the action, customers of the region are consistently facing delays in the delivery, exchange, or returns of their placed orders.
Even Amazon halted business trips to Lebanon and Israel while allowed its most employees of the respective countries to follow a work-from-home model for the week. In contrast, the memo revealed by Amazon said that the company instructed Jordan and Saudi Arabia-based Amazon employees to stay indoors. However, the positive aspect cited by the memo is that Amazon until now has not received any report related to the safety issues of its employees.”
While interviewing, an Amazon spokesperson stated, “The safety of the Amazon partners, stakeholders, and employees across the region is always at our top priority. For this, our team is working closely with local people to make sure of providing the required support.”
Nevertheless, the disruption faced by the ecommerce giant Amazon is a reminder of the way, in which geopolitical tensions may affect global supply chains as well.
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Why Suspended Deliveries Matters for Amazon
Amazon has successfully expanded its logistics industry in different countries or regions of the Middle East with its $600 million acquisition in 2017. Indeed, Abu Dhabi, UAE, and other surrounding countries serve as the backbone of the vast network, along with various Amazon marketplaces in Egypt, Saudi Arabia, and Turkey.
In this way, temporary shutdown of fulfillment centers and suspended deliveries will also result in big losses of Amazon outlets. Regardless of the situation, Amazon does not specify the number of days, the delays will go on or how long they will suspend deliveries in Abu Dhabi and Middle East countries.
Impact of Amazon Centers’ Shutdown on Third-party Sellers
The latest action taken by Amazon ecommerce giant related to the closure of its facility is also adversely affecting the third-party sellers. The impact also extended beyond the own warehouses of the company. For this, the memo cited in the news report to mention the negative impact of the third-party sellers.
Accordingly, approximately 3 lacs of third-party sellers of Middle East are experiencing potential order cancellations and shipment delays with strict logistic channels. Besides, operations of many third-party sellers depend on the infrastructure of Amazon for cross-border shipment across the entire Gulf region. These third-party sellers are also facing problems in deliveries and suffering losses to some extent.
Amazon Continues to Monitor the Situation-the Memo Says
The written memo of the Amazon Ecommerce Giant further highlighted that the temporary halt of its operations in Abu Dhabi will reduce the company’s network capacity across its entire Middle East business. Also, the e-commerce group has chosen a standby operational support mode to manage the present disruption. However, Amazon is regularly monitoring the situation to start its regular operations in the upcoming days as soon as possible.
“The temporary closure of Amazon warehouses and suspended deliveries are due to the coordinated Israeli and US airstrikes across different cities of Iran on February 28, which targeted air-defense systems, miliary command centers, missile sites, and regime infrastructure.”
