Amazon Prime ends free grocery delivery on orders under $150
At a Whole Foods Market grocery store in San Ramon, California, signage advertises new discounts for members of the Amazon Prime service from Amazon, which acquired Whole Foods Market in 2017, June, 2018. (Photo by Smith Collection/Gado/Getty Images)
Amazon is axing free grocery delivery for Prime members on orders less than $150.
Customers who get their groceries delivered from Amazon Fresh -- and pay less than $150 — will be charged between $3.95 and $9.95, depending on the order size, the company said in an email to Prime members Friday.
The new policy starts February 28.
"We will continue to offer convenient two-hour delivery windows for all orders, and customers in some areas will be able to select a longer, six-hour delivery window for a reduced fee," Amazon said in the email.
Launched in 2005, Prime has more than 200 million members worldwide who pay $139 a year, or $14.99 a month, for faster shipping and other perks, such as free delivery and returns.
Currently, the company offers members free grocery deliveries on orders above $35, with the exception of New York, where it’s $50.
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Under the new policy, the company said delivery charges will be $3.95 for orders between $100-$150, $6.95 for orders of $50 to $100, and $9.95 for orders under $50. Amazon Fresh deliveries over $150 will remain free.
Empty interior with logo at Amazon Go concept store, a physical retail store operated by Amazon in which shoppers are able to take items from shelves and exit without a checkout process, having their items automatically charged to their Amazon Prime
"We’re introducing a service fee on some Amazon Fresh delivery orders to help keep prices low in our online and physical grocery stores as we better cover grocery delivery costs and continue to enable offering a consistent, fast, and high-quality delivery experience," Amazon spokesperson Lara Hendrickson said in a prepared statement.
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The company has dozens of Amazon Fresh stores across the U.S. and has opened some abroad. Amazon has also owned Whole Foods since 2017.
The decision to impose new fees comes as the company attempts to trim costs amid a hazy economic environment. In the past few months, it has axed unprofitable areas of its business and paused hiring among its corporate workforce. It said this month that it will lay off 18,000 workers.