Amazon's Cost-Cutting Measures Removes Many Private Label Brands

Amazon is reducing its lineup of private label brands as part of a broader strategy to control costs, according to confirmation provided to CNBC by the company.

Apart from the wide array of products offered by external vendors and well-known brands, Amazon also markets items produced in-house, akin to store-brand merchandise. The range of Amazon's private label brands has expanded rapidly over time and encompasses items such as Goodthreads clothing, Rivet furniture, Presto paper towels, and Amazon Basics batteries.

Matt Taddy, Amazon's Vice President of Private Brands, noted that the company has opted to discontinue some of its in-house products after determining that they did not resonate well with customers.

"Our decisions are always guided by our customers' preferences, and we've come to understand that customers particularly seek out our major brands – like Amazon Basics and Amazon Essentials – for excellent value, high-quality products, and competitive pricing," Taddy explained.

The exact number of private brands Amazon plans to phase out was not disclosed. However, it is anticipated that dozens of brands will be discontinued, reducing Amazon's portfolio to fewer than 20 proprietary labels, as reported initially by The Wall Street Journal.

Amazon has indicated that private label brand sales constitute just 1% of its overall retail sales. As of 2019, the company reported having 158,000 private label products spanning 45 brands, alongside other brands offered through its online grocery service, Amazon Fresh.

Get a Private Label Quote!

Read The Full Story About Amazon Private Label Brands At CNBC