Amazon continues to face a strike by its German employees, who demand higher pay and a better work environment. The German labor union - Verdi - called a strike at four major distribution warehouses in the country - Bad Hersfeld, Leipzig, Graben and Rheinberg - which would continue until the afternoon of Christmas Eve if demands are not met. Amazon operates nine distribution centers in Germany.
Last week, Verdi indicated that special offers during the holiday season have increased the order volumes, putting greater work pressure on employees. Amazon's German workers have been holding strikes at a number of distribution centers since last year. The demands of these workers include the right for collective bargaining, proper working conditions and regard for their efforts. In contrast, Amazon claims that the current wages are above average in the logistics industry.
Germany is Amazon's biggest European market, with sales reaching more than €10.5 billion in 2013 and employing almost 10,000 warehouse personnel. Although Amazon assured that the strikes will not affect deliveries, the current strike could be a matter of concern. Christmas is the peak shopping period and any strike during this time could impact Amazon's sales and profits. Last year, Amazon's orders in Germany peaked on December 15, with customers buying 4.6 million items.
To counter the increasing problems in Germany, the world's largest online retailer had earlier announced its plan to open two fulfillment centers in the Czech Republic by year-end to cater to the increasing demand across Europe.
Fulfillment centers are giant warehouses where online retailers store and ship products, and quickly process returns. These are important for providing the level of service that Amazon's customers have come to expect. Also, the growing demand for online shopping has made it necessary to invest in these warehouses.