As per the latest reports, Amazon has made an announcement in regards to its latest tie-up with Deliveroo. Deliveroo is a major food delivery service that is based in the United Kingdom. Amazon announced on Wednesday, September 15, 2021, that the new tie-up would be for the Prime customers.
As part of the tie-up, the Prime customers would be able to have their takeout orders delivered over to them without any delivery costs. Amazon has announced that the “no delivery fee” policy will be available for Prime customers to benefit from for an entire year. This policy would come into play once the Prime customers a certain amount of criteria.
Amazon has announced that with the launch of the new policy, millions of Amazon Prime customers will be able to avail the service. These users will be able to gain access to Deliveroo’s lower-tier Plus service. Amazon has announced that the UK Prime customers will be able to get free deliveries for any purchases that cross the £25 price. At the time of writing, £25 figure translates to $34.
The analysts have claimed that Amazon has made the announcement with its major tie-up with Deliveroo to avoid any scrutiny from the UK regulatory authority. It was reported that the Competition and Markets Authority was in the process of investigating whether Amazon’s partnership with Deliveroo posed any risks for competitors.
Amazon proposed the idea and partnership with Deliveroo just in time and saved itself from further scrutiny from the UK regulatory authority. The UK competition regulator proceeded with approving the request launched by Amazon. The regulatory authority also stated that Amazon’s tie-up with Deliveroo is not at all an act of taking out the competition.
The regulatory authorities in the United Kingdom also stated that without making a deal and partnering with Amazon, Deliveroo would have a really hard time surviving.
As a result of the latest tie-up, Amazon now has a decent stake percentage in Deliveroo’s operations. As per data from filings, Amazon currently has a 16% stake in the UK food delivery service. Deliveroo is a food delivery service that is run by Will Shu, who is a former banker at Morgan Stanley.
As of now, Amazon has over 200 million subscribers for the Prime service from all over the world. At present, Amazon has not confirmed exactly how many subscribers it has in Ireland and the United Kingdom.
For now, Deliveroo has not confirmed if Amazon has paid any extra fees or has compensated for them for offering free deliveries to Amazon Prime customers. In the past, Deliveroo had partnered with Amazon in order to carry out a funding round, helping it raise $575 million.