Amazon will charge delivery fees on fresh grocery orders under $150

Brendan McDermid | Reuters

Amazon will start charging delivery fees for fresh grocery orders under $150, which it says will help keep prices for its services low.

Starting Feb. 28, Prime members who want home delivery by Amazon Fresh will incur a $9.95 delivery fee for orders under $50, while orders between $50 and $100 will incur a fee. $6.95 shipping, and orders between $100 and $150 will incur a $3.95 shipping fee. , the company said in a note to clients viewed by CNBC. Only Prime members can use the delivery service, although anyone can shop at an Amazon Fresh grocery store.

Amazon previously guaranteed members of its $139-a-year Prime service free shipping on Fresh orders over $35.

«These service fees will help keep prices low in our online and physical grocery stores as we better cover grocery delivery costs and continue to provide a consistent, fast and high-quality delivery experience,» the company said. ‘notice.

The move comes as Amazon CEO Andy Jassy embarked on a thorough review of the company’s spending amid slowing sales and deteriorating economic prospects. Amazon plans to lay off 18,000 employees, freeze hiring of its workforce and suspend or cancel projects such as a sidewalk robot and telehealth service.

Amazon previously recalibrated its approach to online grocery deliveries, a notoriously difficult business from a cost and efficiency perspective. In 2021, Amazon added a $10 service fee for Whole Foods delivery orders to Prime members, after previously offering them at no additional cost.

LOOK: How Whole Foods has changed in the five years since Amazon’s takeover

How Whole Foods has changed in the five years since Amazon's takeover

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