Amazon Workers End Strike in Germany Over Wage Dispute - Analyst Blog

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Credit: Shutterstock photo Inc. 's ( AMZN ) German employees have put an end to the strike called for higher pay and a better work environment.

Per reports, approximately 2,000 workers of the world's largest online retailer have called a two-day strike at four major distribution warehouses - Bad Hersfeld, Leipzig, Graben and Rheinberg - demanding the right for collective bargaining, proper working conditions and regard for their efforts. Last year, German labor union - Verdi - had launched many strikes at Amazon's distribution warehouses with similar demands. However, Amazon claimed that the current wages are above average in the logistics industry.

Germany is Amazon's biggest European market and the company employs around 9,000 full-time workers in the country, with thousands more on temporary contracts. Though the company assured that previous strikes had not affected deliveries, the current strike could be a matter of concern due to the arrival of the shopping period.

Seeing the increasing problems in Germany, Amazon had earlier announced its plan to open two new fulfillment centers in the Czech Republic by the end of 2014 to cater to the increasing demand across Europe.

The growing demand for online shopping has also led to the need to expand the fulfillment centers.

Fulfillment centers are giant warehouses that help Amazon and other online retailers to store products, ship them and handle returns quickly. These are important for providing the level of customer service that customers have come to expect of the company.

As accurate delivery of products is very important for the success of an online retail company, these strikes could delay product delivery during the peak holiday season, which in turn could translate into losses for the company.

Amazon currently has a Zacks Rank #4 (Sell). Better-ranked stocks in this industry include Mercadolibre, Inc. ( MELI ), World Energy Solutions, Inc. ( XWES ), and PetMed Express, Inc. ( PETS ). While Mercadolibre and World Energy Solutions sport a Zacks Rank #1 (Strong Buy), PetMed Express holds a Zacks Rank #2 (Buy).

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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