Amazon cancels wholesale orders of products made in China amid trade war: report

Following tariffs implemented by President Donald Trump in early April, Amazon has canceled orders for some products made in China and other Asian countries. The US tariff on Chinese imports stands at 125%.

People familiar with the matter told Bloomberg that the company halted orders for air conditioners, beach chairs, scooters, and other items from Amazon vendors following Trump’s April 2 announcement of tariffs on over 180 countries worldwide. 

Per the outlet, "The timing of the cancellations, which had no warning, led the vendors to suspect it was a response to tariffs." It is unclear how many types of merchandise the cancellations would affect, or how widespread the cancellations were.

One email reviewed by Bloomberg was sent to a vendor who has been selling beach chairs on Amazon made in China for over a decade. The company told the vendor in the email sent last week that it was canceling some purchase orders it had placed "in error," and told the vendor to not ship them.

The vendor said that the wholesale order amounted to $500,000, and the order was canceled after the chairs had already been made, leaving the vendor to find other buyers. The vendor, who feared retaliation from Amazon and spoke anonymously, said that they had never had an order canceled in this way.

Scott Miller, who previously worked as an Amazon vendor manager and now works as an e-commerce consultant, told the outlet that Amazon had canceled orders for several of his clients for products made in China and other Asian countries without warning. 

"Amazon really holds all of the cards," said Miller. "The only real recourse vendors have is to either sell this inventory in other countries at lower margins or try to work with other retailers."

Both the chair vendor and Miller said that the company had canceled "direct import orders," in which Amazon purchases inventory wholesale from the country in which the product is manufactured and then ships those to its US warehouses. Under these orders, Amazon serves as the importer and pays tariffs when the product reaches the US. 

Through direct import orders, Amazon can often use bulk shipping rates to bring the items to the US at a lower cost than vendors, and has been using this method to import items for years.