...Analysis of Amazon’s supply chain investment strategy When speaking about the largest retailers in the United States, one will always mention the two largest retail distributors, Walmart and Amazon. While the former company depends on its brick and mortar stores as the major contributor or their revenues, the latter focuses most of its attention on internet-based retailing. Amazon was founded by Jeff Bezos in 1994 due to his belief that he would regret not participating sooner in the internet business boom during the 1990’s. Bezos read a report about the future of internet which projected annual web commerce growth to be at 2,300%. At the beginning, the company was pioneered as an online bookstore due to the low price point of books and the huge number of titles available. The advantage Amazon had compared to other brick and mortar store was that an online bookstore could carry several more times the titles than a physical store, since there is an unlimited virtual warehouse. By 2000, the company had moved away from simply selling books, while expanding into an online marketing place selling many varieties of goods and services. Due to Amazon’s early entry into the online retail market, it had the first mover advantage to allow the company to “get big fast” and become one of the the most recognizable names on the internet. By the end of 2002, Amazon had 22.3 million registered users on the website which makes it one of the largest online retailing company at that time. However...
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... Every company has their own supply chain in order to sort or produce goods. However, the company needs to manage supply chain to maximize its highest benefits. By having effective supply chain management, the company can ensure that the right product or service will be available at the time to the right place and at the right price (Kamal 2007). Amazon is one of the companies that have best supply chain practices in order to respond high level of responsiveness for the customers. Thereby, this paper explains about Amazon Company, analysis of Amazon’s supply chain, recommendations and barriers to implement will be discussed. Company background Amazon is an American commerce company based in Seattle, Washington, USA. The company used to be only a bookstore, but now it diversified into difference type of products. The goal of Amazon is to provide one stop shop experience where the customer can find everything on Amazon as earth’s biggest selection (Warman 2012). Amazon operates as a pure internet retailers that does not have retail store at all while the delivery will be done through Amazon’s networks of distribution centres. This operation makes the company is able to provide wider range of goods and lower cost of products with high quality. Moreover, it is also increase customer satisfaction as it supports customer convenience. An effective supply chain strategy makes the company is able to respond high level of responsiveness. Amazon balances between cost of distributions...
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...MGMT90026 Supply Chain Management Group Assignment Dr. Vikram Bhakoo Class: Tuesday 6:15-9:15 MGMT90026 Supply Chain Management Group Assignment Dr. Vikram Bhakoo Class: Tuesday 6:15-9:15 By: Widad Alharthi 822694 Di Cao Wasinee Phornnarit Yang Chan By: Widad Alharthi 822694 Di Cao Wasinee Phornnarit Yang Chan Table of Contents Introduction: 2 1. Supply Chain Management Practices 4 1.1 Walmart 4 1.1.1 Strategic allignemnt 4 1.1.2 procurement and distribution 5 1.1.3 Logistic and distribution management 5 1.1.4 Inventory management 6 1.2 Amazon 8 2. Strategic Alliances 9 2.1 Walmart 9 2.2 Amazon 10 3. Technologies employed in the SC Network 11 3.1 Walmart 11 3.2 amazon 13 4. Challenges and risks 14 4.1 Walmart 14 4.2 Amazon 15 5. Comparison of sustainable strategies in Supply Chains 16 conclusion 17 References: 18 Appendices: 19 Section A: 19 Section B: 19 Section C: 20 Introduction: Executive summary: This report provides an analysis and evaluation of the current supply chain strategies employed by two leading retail corporates, Walmart and Amazon. The report draws attention to the following aspects; supply chain management practices, strategic alliances, Information Technology, challenges and risks,finally sustainability in the supply chain. Method of the analysis includes reviewing a collection academic journals from different databases, analysing company’s...
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...Problem Statement Should amazon continue with its current online business model, or diversify by opening retail locations. Situation Analysis – mission, objectives, background, forecast * One of the first online shopping places, launched in 1995. The first online market place to focus exclusively on books. * Ranked as one of the most visited sites online, with one of the highest unique visitor rates * Aside from the original amazon.com for US Customers, the company has 5 additional websites to serve particular countries including sites for Canada, Japan, United Kingdom, Germany and France. * Unique features include: One click purchase option with receipt delivered to email with email verification, extensive database of customer reviews, and market leadership in establishing eBooks with instant deliveries to Kindle. * Initial model was centered around Amazon being the middle supplier, and not holding on to any inventory. The vendor would ship the item directly to the end customer, thus amazon would benefit from not having to take on any inventory costs. However due to various issues, such as vendor inability to honor shipment times, Amazon had to change its model and acquire warehouses and become an actual distributor. * Amazon currently has 10 large scale warehouses, with over 1 Million square footage dedicated to warehousing activities. * The warehousing is supplemented by an state of the art automated supply chain management system with automatic...
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...Amazon’s Business Model For this assessment, I chose to write about Amazon.com; this online retailor is one that I utilize numerous times each month, though never really stopping to examine how they became such an important part of my shopping routines, or how they accomplish the online store front, purchasing ease and fast shipping capabilities that I’ve become accustomed to. Amazon has strategically woven its way into our everyday conversations about products and purchasing decisions; including reviews from customers who have purchased items in the past, to the pricing discounts available, and how .com pricing and product quality compare to traditional retail locations. In these discussions, Amazon is always one of the first sites considered. How Amazon accomplishes its ability to predict consumer trends, ease purchasing transactions and deliver products quickly and efficiently is as much about common sense as it is about strategy, integration, utilization and creation of new technology. When Amazon’s founder Jeff Bezos began analyzing a business to begin utilizing a unique competitive strategy to eliminate the cost and delay that retail locations added to a business process, he looked for opportunities that offered low priced products, contained a large market of current and future customers, and one that offered a wide range of choices; he decided that the market for books offered the greatest area for advancement and improvement. Books offered a variety of possibilities...
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...Current State of Amazon.com’s digital engine based SCM Amazon.com sells almost all products you would buy online: beauty supplies, clothing, books, CDs, computers, TVs, and so on. The number of products that Amazon.com is currently selling on its website is countless via its large supply chain network. To handle this extensive range of products, Amazon.com not only uses the direct Amazon-to-buyer approach, but also employs the multi-leveled e-commerce strategy. This multi-leveled e-commerce strategy allows Amazon.com to have large supply chain network by letting almost anyone sell almost anything by using Amazon.com’s platform. Thus, individuals, small companies, and big retail companies can all be part of Amazon.com’s supply chain. It can be considered the “ultimate hub’ for selling merchandise on the web (“How Amazon Works”). Technical and Economic Aspects of Amazon.com SCM Amazon.com uses a digital engine to support the supply chain of unlimited inventory and categories, including digital goods, in worldwide market with real-time optimization. Therefore, it resolves any limitations that physical businesses might encounter. The digital engine processes every information and data at high speed (“Amazon.com: the Hidden Empire”). As soon as customers search products, it provides various options ranging from cheapest options to specific options that customers want. Once customers places orders, digital engine quickly processes order information and transfers information to its...
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...1. Problem Statement Since Amazon was established in 1994 it has focused on growth – “get big fast”. This focus on growth of number of clients was based on the assumption that to establish Amazon as the biggest internet retailer in the world secured long term profitability instead of short term profitability. The growth had been carried out through expansion in markets and an aggressive acquisition strategy. In 2000 the investors started to change focus and while they had been willing to support the expansion for market share they now started to focus on profitability. Amazon therefore needed to change strategy and adapt to the need for running a profitable business with the new watchwords “march towards profitability”. But the question is whether Amazon can change the company around and become profitable and how they can achieve it. Some of the questions which need to be answered is: • What should Amazon do next? • Should it continue its international expansion, or perhaps retrench to allow for more profitable operations? • Should it add product categories or cut back to its Books, Music and Video core? • Could Amazon use its brand strength and sophisticated personalization algorithms to individually price its way into the black? • Could Amazon steal a page from Wal-Mart and focus on supply chain management to part the sea of red ink? • Alternatively, should Amazon return to its virtual roots and outsource...
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...An In Depth Analysis of Amazon Inc. In Relation to Information Technology Systems Table of Contents History page 3 Management page 4 Competitive Advantage page 5 Five Forces Model page 6 IT Strategy page 8 Value Chain page 9 E-Business page 13 Operating Systems page 15 Risk Assessment page 16 SWOT Analysis page 17 Supply Chain Management page 19 Customer Relationship Management page 19 Current Issues page 21 Recommendations and Conclusion page 22 Exhibits page 24 History Amazon.com, Inc. is a multicultural electronic commerce company founded in America by Jeffrey P. Bezos in 1994. It was originally named Cadabra, but was renamed after the Amazon River to bring into the picture a more powerful meaning (mashable). Amazon, since its release in 1995, has since become one of the Fortune 500 e-commerce company. In the business world, Amazon is currently the largest online retailer in the world. It manufactures consumer electronics, most widely known is the Amazon Kindle e-book reader, and has an extensive cloud computing service. Amazon’s start-up was initially only an online bookstore, giving Amazon an advantage of having more and readily available books than any long-established brick-and-mortar book store. By the last 1990’s, Amazon’s success had enabled an expansion from an online bookstore to a wide variety of other products...
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...In the first years, Amazon intentionally kept its website systems separate from its order-fulfillment system. The separation was partly due to the fact that they did not have the technical ability to connect them, and partly because the company wanted to improve security by keeping the order systems off the Web. By 1997, Amazon‘s sales had reached $148 million for the year. Their databases were being run on servers while applications were being written in house. By early 2000, the company had over 100 separate database instances running on a variety of servers. These servers were handing terabytes of data. In 2000, Amazon decided to overhaul its entire system. The company spent $200 million on new applications, including analysis software from Epiphany, logistics from Manugistics, and a new DBMS from Oracle. The company also signed off on deals to work with SAS for data mining and analysis. However, the biggest deal was with Excelon for business-to-business integration systems. The system enables suppliers to communicate in real time, even if they do not have sophisticated IT departments. It provides a direct connection to Amazon‘s ERP system either through programming connections or through a Web browser. About the same time (May 2000), Amazon inked a deal with HP to supply new servers for IT department. The new systems ran the open-source Linux operating system. The return on investment was seen in 2001. Amazon was able to cut their IT costs by 24 percent in 2001 when...
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...this publication at: http://www.researchgate.net/publication/261440748 A STUDY ON AMAZON: INFORMATION SYSTEMS, BUSINESS STRATEGIES AND e-CRM ARTICLE · APRIL 2014 READS 9,305 1 AUTHOR: Abdullah Al Imran 1 PUBLICATION 0 CITATIONS SEE PROFILE Available from: Abdullah Al Imran Retrieved on: 29 September 2015 A STUDY ON AMAZON: INFORMATION SYSTEMS, BUSINESS STRATEGIES AND e-CRM MD. ABDULLAH AL IMRAN DEPARTMENT OF COMPUTER SCIENCE & ENGINEERING UNIVERSITY OF LIBERAL ARTS BANGLADESH rasel1292@gmail.com 2014 Table of content Background 3 Part 1- Information Systems utilized for internet activity 3 1. Information System 3 2. Transaction Processing System 4 3. 1-click purchase 4 4. Secure C/debit card payment 4 5. Recommendation System 5 6. Interactive searching System 5 7. Supply Chain Management (SCM) 5 8. Enterprise Resource Management (ERP System) 5 9. Customer Relation Management (CRM) 5 Part 2-Business strategies applied for internet activity 6 1. Smart Innovation Strategy 6 2. Customer Relation Management Strategy 7 3. Jeff Bezos 3 big idea 7 Page-1 A. Limitless inventory 7 B. Customer Care 8 C. High margin, lowest price. 8 4. Marketing and Promotion Strategy 8 5. Associate Program 8 Part 3- eCRM cycle Conducted for internet Activity 9 1. Customer Relationship Management 9 2. Electronic Customer Relationship Management 9 3. How amazon implement CRM 9 4. Customer Selection 10 5. Customer Acquisition 10 A. Customer...
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...Amazon goes global Gary Sanghera BUSM 4200 Amazon goes global Gary Sanghera BUSM 4200 Table of Contents Executive Summary 2 General External Environment 3 Industry Analysis 6 Internal Environment 7 Porter’s Value Chain 10 SWOT Analysis 12 Endnotes 13 Executive Summary Amazon.com Inc. is the largest online retailer in the world. The purpose of this report is to find out whether Amazon should take a break from its global expansion and focus on strengthening its existing operations or if the company should continue to explore new market opportunities and if so to find out which market Amazon should enter if it continues to expand. The external environment indicates many significant trends that Amazon should consider and use to its advantage, for example the rapidly growing online retail industry; more investment from governments in information and communication technologies and a strong demand for this investment from the all markets is causing a rapid expansion in customers buying online. Porter’s five forces indicate that online retail industry is difficult to enter into due the brand image that the top firms have now established, but it is very easy for customers to compare prices among the top online retailers to find the best product for the cheapest price; indicating a high buying power for consumers. Suppliers do have some power if they offer a unique product that cannot be easily bought elsewhere, like Amazon selling Harry Potter novels. However...
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...amazon global fullfilment strategyAmazon.com Supply Chain This area of the paper focuses on Amazon.com's supply chain and how it supports their business in the internet retailing environment. First, we have discussed Amazon.com's different operating models and explained the different supply chains that support those business models. After the business and supply chain models are defined we have discussed Amazon.com's supply chain network, inventory segmentation strategies, order sourcing decisions, overall replenishment and fulfillment process flows, intra-warehouse process flows, and transportation policies. This report analyzes the overall Amazon.com supply chain for United States distribution with a specific emphasis on the Media product segment. Amazon.com US Retail Product Segment Books, CDs, and DVDs and magazine subscriptions comprise the media product line at Amazon.com (Amazon.com 2002 Annual Report). Amazon.com began as an online bookseller and its first product line expansions were music and movies. As a result, the Media segment comprises a large percentage of Amazon.com overall revenues. In 2004, Media accounts for 74% of all revenues. Within the US, the Media segment accounts for 67% of all revenues. In dollar terms, the Media segment in the US generated $2.6 billion in revenue in 2004, compared 115 to $3.8 billion generated across all segments in the US (Amazon.com 2004 10-K Report). The pie chart below shows the breakout of revenue percentages by product and...
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...Since San Walton opened his first store in 1962, Walmart has grown into a global retailer with more than 4,000 store in the United States and more than 6,000 internationally. Walmart is comprised of three business segments, Walmart US, Walmart International and Sam’s Club. Walmart Global eCommerce works across all three segments. Walmart’s mission statement “We save people money so they can live better”, is not indicative of where its strategic focus areas are, but it does sound good for the average customer who has a limited budget. This mission statement leads directly into Walmart Global eCommerce goals which include combining online, social innovations with physical stores to give consumers “anywhere, anytime shopping experience” in addition to its organizational sustainability goal of creating zero waste, using only sustainable energy and selling products that sustain the environment which is important to all of Walmart’s segments including eCommerce. Walmart’s overall objective is to deliver shareholder value by increasing earnings per share, returns and maintaining strong stable returns on investment. According to Walmart CEO, Mike Duke, Walmart’s strategic focus areas are: •Making sure the company has the best retail talent at every level of the organization by recruiting, developing and retaining the best associates; •Delivering on the productivity loop that enables Walmart to operate for less so the company can drive prices even lower for its customers ...
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...INSTITUTE OF BUSINESS MANAGEMENT STUDIES Term End Examination/ Supply Chain Management. All Questions are compulsory. Total Marks : 100. Q.1 Consider the supply chain involved when a customer order a book from Amazon. A. Identify the push/pull boundary & two process each in the push & pull Process? Answer : In Amazon’s original operations design the push/pull boundary existed betwixt the retailer (Amazon) and their distributor. Amazon ordered product from the distributor and the customer order arrived. Today, Amazon has six warehouses where it stocks an inventory of items it is confident that will sell. In this scenario, the push/pull boundary exists between the customer and the retailer. All supply chain processes can be broken down into four process cycles that connect the five stages of the supply chain; the customer order cycle, the replenishment cycle, the manufacturing cycle, and the procurement cycle. The customer order cycle connects the customer with the retailer; this connection is made as the book, perhaps Supply Chain Management, is selected and paid for by the customer. Processes in the pull phase are the order fulfillment, shipping, customer returns, and customer billing. Processes in the push phase are production, stock replenishments, shipping, and payment. B. How do you characterize the competitive strategy of high end dept. store chain Such as Nordstrom? What are the key customer needs that Nordstrom aims...
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...technology and the advances in global communications pose significant risks to American global organizations such as Amazon, Borders, and Books-A-Million as they expand in the international environment. This paper will also analyze the potential risk for American entities to invest in overseas global operations, in light of the swift accrual of the most advanced global communications technology and the rapid adoption by overseas employee cohorts of technical expertise in global communications. Finally, this paper will discuss the possible outcomes of entering into strategic alliances with potential overseas competitors, and evaluate the risk in exercising this option. Company Background Amazon.com, Inc. is a customer-centric company for three primary customer sets: consumers, sellers, and enterprises (Amazon, 2011). The company generates revenue through other marketing and promotional services, such as online advertising, and co-branded credit card agreements. The company operates in North America and some international companies. The company serves consumers through its retail websites, and focus on selection, price, and convenience (Amazon, 2011). Amazon (2011) websites enable products to be sold by it and by third parties across several categories. The company offer membership and also provides easy to use functionality, fulfillment, and customer service (Amazon, 2011). Borders Group, Inc. is an operator of book, music and movie superstores and mall-based bookstores (Borders...
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