Amazon Inc. (NASDAQ:AMZN) has announced the launch of a new paid membership program aimed at multi-user businesses in the U.S. and Germany. The program, called Business Prime Shipping, extends Prime’s free, two-day shipping benefits to all users with an Amazon Business account. The retailer did not say when the option would expand beyond the U.S. and Germany.
The new membership program’s pricing is based on the number of users on the account. For companies with up to 10 users, memberships start at $499. For businesses with up to 100 users, the price starts at $1,299 and it goes up to $10,099 for those with over 100 users.
Greg Greeley, Vice President of Amazon Prime, said in a statement, “Business Prime Shipping combines the wide selection of products available to Amazon Business customers, with the speed and convenience that customers have come to know and love from Amazon Prime.” Interested customers can sign up for a 30-day free trial of the new feature.
After an account is created for the company, the program sends out an alert to all of the users that the benefit has been enabled. New users added to existing Amazon Business accounts will be automatically added to the program.
Amazon Business offers bulk discounts and exclusive pricing on millions of eligible items. Users can also compare offers between sellers, review reporting and analytics, and integrate the program with over 30 purchasing systems.
Amazon Business first launched in the U.S. in 2015 as a replacement for Amazon’s Amazon Supply B2B brand. The program later expanded to Germany, the U.K., India, and Japan, as well as other markets.
Amazon says the new program will simplify procurement. The move is being seen as a direct challenge to office supply stores. There are concerns that Amazon will use low prices and convenience to take market share from business suppliers the same way it took market share from book stores, department stores, and big-box retailers.
Shares of industrial suppliers WW Grainger Inc. and Fastenal Co. dropped on the news. Grainger fell as much as 4.6 percent and Fastenal dropped as much as 4.2 percent. Grainger shares are down more than 12 percent year to date.