...Amazon.com 1. How would you define Amazon’s industry? What difficulties do you encounter identifying primary competitors and key lines of business? Amazons primary industry is electronic commerce. At its core Amazon is an electronic commerce retailer. But over the years the brand has developed into something grander. Originally the company started out as an online bookstore but now has diversified its inventory to include dvds, software, video games, electronics, furniture, apparel, food, toys, and jewelry. Amazon has also become a producer of their own brand of consumer electronics, most notably their line of Kindle e-book readers, Fire Tablets, Fire TV, Fire phone, and is now a leading provider of cloud computing services. Now Amazon is starting to introduce a new service called Amazon Fresh. Amazon Fresh will bring the grocery shopping experience into the comfort of your home. The customer will be able to order his or her groceries through Amazon and have them delivered the very same day. Fast and convenient, no longer will one have to make the tedious trek out to the supermarket in order to load up on food. The difficulty in identifying a primary competitor is the fact that no company comes close to doing everything that Amazon does. Sure there are plenty of companies that specialize in selling some of the items that are found on Amazon.com, but nowhere else will you be able to order a used copy of an algebra textbook your son needs for school, a diamond pendant for your...
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...Homework 1 Solutions Problem 1.8 a 1.8 b 1.14 a 1.14 b 1.14 c 1.15 11.10 a 11.10 b Amazon 1 Amazon 2 Amazon 3 Amazon 4 7.9 a 7.9 b 7.11 Matthew 1 Matthew 2 Total Points 2 2 2 2 2 4 3 2 3 2 2 2 2 2 4 2 2 40 Answer to 1.14(c) is included in (a) and (b) AMAZON.COM 1. Some of the opportunities and disadvantages of selling books over the Internet are summarized here: Factor Revenue Impact Increase Causes Convenience Large variety of books Customer-specific recommendations Distributor margins Downward price pressure Inability to browse Aggregation (major benefit is for low-volume books) No retail outlets, only warehouses No cashiers required Each customer order is picked and packed Higher outbound transportation costs Instant knowledge of customer preferences and tastes Track customer history (purchases) and make recommendations to the customer Decrease Inventory cost Facility costs Decrease Decrease Increase Transportation cost Increase Forecasting Customer Understanding Added Improved 2. The benefits of using the Internet for book sales are significantly larger now that books can be downloaded online. Amazon is able to ship some products over the Internet, saving the final shipping cost but changing the nature of its business. Amazon will be software intensive rather than book and warehouse intensive. 3. Other downloadable products are software and music. In both instances, Amazon increases the benefits of e-commerce if it either...
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...Abstract Online shopping or e-commerce is developed rapidly and has a gigantic impact in globalization. Many consumers around the world start to trade products or do business using this system. The most crucial factor for consumer who shops online is trust. Grabner-Kraeuter (1989 p.43) states “Trust can serve as mechanism to reduce the complexity of human conduct in situations where people have to cope with uncertainty”. This paper tries to analyze that which method can be use by online merchants to increase their consumer trust. Various action and tools are introduced to increasing customers’ trust and verify the website information. Amazon.com is chosen to be the case study. The reason behind this is the popularity and reliability of the website and it is ranked in the top30 website in the world. Introduction Figure: E-commerce market size from 2004 to 2014 Source: Euromonitor, International Telecommunication Union; A.T. Kearney analysis E-commerce is now widely used and has a huge impact in globalization The graph above shows the upward trend of e-commerce market size which increasing respectively since 2004 and from now on the trend is also estimated to be rising due to the benefits of it. There are significant reasons behind that why majority of people use this method of trading. First of all, consumers can trade goods easier than by traditional shopping. Consumers can obviously gain convenience when they shop online since they can purchase or sell products...
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...Case 9 in your textbook * Answer the all of the questions at the end of the case study Case Study – Amazon.com, Inc – Retailing Giant to High-Tech Player? 1. Complete a table on key ratios: * Current Ratio - Current Ratio = CA/CL What the current ratio does measures if the firm has enough resources to pay its debts over the next 12 months. Comparing current assets to current liabilities. Current Assets | Current Liabilities | Cash $10,500 | Accrued Expenses $6,000 | Credit receivables $11,000 | Accounts payable $7,000 | Inventories $15,000 | Taxes Payable $ 12,000 | Prepaid Expenses $16,000 | Current Mortgage $30,000 | Accounts Receivables 7,000 | | Marketable Securities $3,000 | | Total $62,500 | Total $55,000 | $62,000 – $55,000 = $7,000 * ROI% - ROI = NP after taxes/Total Assets Return on investments indicates the returns generated on total assets, and/or the overview profit on investment in percentage form. This formula below is calculated in Du Pont form; ROI = $16,000 / $200,000 = 16% Net Profit =$16,000 / $100,000 =8% Total Assets =$200,000 / $100,000 = 2 times ROI 8% * 2 times = 16% * ROE(%) - ROE = NP after taxes/Shareholder Equity The amount of net income returned as a percentage of shareholders equity. An example would be; ROE = ($18,000 ÷ $100,000) x ($100,000 ÷ $45,000) ROE = 18% x 2.22 ROE = 40% * Net Profit Margins (%) - NPM = NI/Revenue 2. Answer the following questions: ...
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...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 service segment. Fig Amazon.com does not provide margin numbers by product segment, so the Media contribution to profit is unknown. JP Morgan estimates that Amazon.com gets 25% gross margins for books and media and 15% for electronics ("US Equity Research: Amazon.com", 2005). Additionally, data regarding important financial metrics such as inventory turnover, free cash flow, and...
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...Amazon.com Case Analysis Consumer Behavior Overview Amazon.com is a Fortune 500 company based on the internet as the Earth’s biggest bookstore in July 1995 and today is biggest everything store. Amazon has become the Earth’s most customer-centric company, where consumers can find and discover anything they might want to buy online and endeavors to offers its customers the lowest possible prices and the best customer service. Amazon.com offers millions of new, refurbished and used items in categories such as health and personal care, jewelry and watches, gourmet food, sports and outdoor equipment and apparel, books, music, DVDs, electronics, office equipment, toys and baby supplies, home and garden and on demand video. Amazon has also established separate websites in Canada, the United Kingdom, Germany, France, Italy, Japan and China. They provide international shipping to certain countries for some of its products. Amazon.com Case Analysis In 1994, Jeff Bezos left his job as senior vice-president of an investment firm, moved to Seattle, and began to work out a business plan for what would become Amazon.com. After his evaluation of report that projected annual Web growth at 2,300 percent, Bezos drew up a list of 20 products that could be sold on the Internet. The list was narrowed down to what he felt were the five most favorable: compact discs, computer hardware, computer software, videos, and books. Bezos eventually decided that his venture would sell books over the...
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...widely known to use the internet as the sole method for selling extensive selection of goods to its consumers. Amazon has grown from a book seller to a virtual Wall Mart of the Web selling diverse products. Amazon’s growth and diversification of business offers the following advantages: 1. Cost Leadership is pursued by Amazon.com by differentiating itself primarily on the basis of price. Due to this strategy, Amazon.com always makes sure that it offers the same quality products as other companies for a considerably less price. 2. Cost Savings: Amazon’s business strategy has helped it reduce costs associated with operations and staffing. A reduced cost gives increased revenue. 3. Provides current and prospective customers with different design, quality or convenience. Amazon.com always selects a differentiator that is different among the competitor. So, Amazon.com consumers can recognize and differentiate its product. 4. Existing expertise, knowledge and resources in the company is a major advantage when expanding into new activities 5. Provide better risk control through no longer being reliant on a single market or product. 6. In case of unrelated diversification as...
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...1. Before Amazon.com was created, the supply chain for books was fairly simple; Publishers sold books to wholesalers, who then distributed them to various retail bookstores, institutions, and libraries. Once the books were distributed to different physical stores, consumers could go to the various locations and purchase the books. Amazon.com changed that process completely. Because they are a virtual bookstore, their supply chain for books varies from that of traditional bookstores. In a traditional supply chain, the publishers sell books to warehouses on a consignment basis; if books don’t sell, then the publishers accept returns and provide a 100% refund. However, as the case mentions, Amazon.com contacts publishers, rather than a warehouse, to ship certain books, and they only do so once a customer has actually paid for the order. Amazon.com has also created its own distribution center in Delaware, allowing the consolidation and packaging of books for shipment. Because the firm is a virtual store, they have no bookshelves or limitations on the number of books they can sell. Consumers do not have to leave their living room to purchase a book, which differs from traditional supply chains greatly. 2. Because Amazon.com was one of the first companies to begin selling books online and in doing so, established a loyal customer base, I believe it would not be a good idea for other firms to enter the virtual bookstore market. The case mentions a few big name distributors, such as...
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...Amazon.com's New Business Portfolio Being Launched Mark Vasquez Park University Amazon.com's New Business Portfolio Being Launched I. Describe the portfolio of new business services being launched by Amazon.com Amazon has mastered the logistical and technological facets of successfully running itself. Amazon.com has thrived in a highly competitive retail atmosphere. Amazon.com now seeks to expand its enterprises by offering its own resources, retail expertise, business enhancements, technological tools and highly advanced features to other businesses for a price. The incentive for these businesses to purchase Amazon.com’s services is so that they are able to streamline their own processes and become more efficient and ultimately more profitable. Amazon.com seeks to appeal to prospective clients by offering them services that will enable them to operate in a more seamless manner. Essentially Amazon.com is selling various “easy buttons” for the many “chores” of running a business. Outside companies would be able to Amazon.com’s operational systems to efficiently distribute their products, use their warehouse space for storage, calculate and analyze statistical information, store data, and utilize Amazon.com’s platform to access the media. Critics are skeptical of Amazon.com’s expansion plan because the cost of purchasing the technology needed is a significant expense. In addition to this, hiring tech professionals to develop, hone and run these new services is another financial...
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...Case 1 Overview This case takes a look at the life of Amazon.com and the many changes to strategies that have been made over the years. Starting out in his garage, former investment banker, Jeff Bezos, took a risk and decided to start Amazon.com. He looked at factors such as, the annual growth in web usage and also looked at features of the book industry, and decided that Amazon would initially be an online bookstore. Bezos focused on growing his company quickly, and by doing this formulated a winning strategic plan that focused on customer service and creating a culture for the company that was filled with talented and unconventional employees. Starting with these factors in mind resulted in Amazon ultimately becoming the most recognizable Internet retailer in the world. Amazon.com has made many changes to its strategies in order to stay ahead of the curve due to the rapid growth of the Internet. Although it started off strictly selling books and the focus was on becoming the “Earth’s Biggest Bookstore”, overtime Amazon.com began to introduce other products to its site. One of the main objectives of the company was to become the best place to buy, find, and discover any product or service available online. Due to Amazon’s evolving strategy, they became the number one online music and video seller. They also acquired companies in the UK, Germany, Canada, France and many other countries. Overtime, instead of fighting for a place amongst big names such as Barnes & Nobles and...
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...TD5 Group 1 STRATEGY “Amazon.com Case Study” * Question 1: Analyze Amazon.com each year from 2004 to 2006: The case shows Amazon’s strategy from 2004 to 2006. The year 2003 was the introduction of the new Amazon’s strategic plan. Indeed, from 2001 to 2003 Amazon realized negative income and the economic situation of the company was worrying. Because of the sharing price falling sharply, Amazon had to find an alternative to improve the situation. * Year 2004: Amazon.com adopted a new strategy that was based on innovation. They decided to expand their product range to sell others items and to diversify its offer. Moreover they tried to make their products more affordable thanks to discounts (30% on books over $15) and an additional discount was offered to the customer who used the Amazon’s A9 search engine. This strategy allowed them to make more profits and re-launch the company. Then, they acquired Joyo.com that is website in corporation in order to be more international. Besides, they created more internet domains such as .de that is the denomination of the Deutsch Amazon’s website (internationalization). They innovated thanks to A9.com which builds innovative search technologies. Amazon.com diversified its offer by creating two new product categories: beauty and jewellery (75 000 products). There is a large category of prices from cheap to expensive ($13/$93 000). The main objective is to be the single shopping place on the web. The project “Search...
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...INTRODUCTION: Amazon.com opened for business in July 1995, nobody in that time was optimistic for this brand new business model. People still enjoy the physical store, and skeptical on online shopping. However, with more than a decade efforts, Amazon was named the world’s top brand ahead of common names like Coca-Cola, Microsoft, and so on. Amazon and its online business model had creased more than $34 billion revenue, and equally 80 million people visit Amazon.com every month. In order to achieve greater success, Amazon need to overcome the challengeable external environment, strengthen organization structure, fulfill the product line, and leverage its brand strategy. CURRENT MISSION, GOAL, AND STRATEGY The current mission statement for the Amazon.com is “to be the Earth’s most customer-centric company, where customers can find and discover anything they might want to buy online, and endeavor to offer customers the lowest prices.” Amazon added 13 new fulfillment centers in 2010 and another 15 new center in the 2011 and company is planning to launch cloud technology in 2011 which allowed customers to store and access music. The company believed that in the nearly future this technology could bring the internal strength and competitive advantage for Amazon.com. INTERNAL ANALYSIS: See attached IFEM Amazon.com internally with an IFEM score of 3.25 FINANCE: Amazon is on strong financial position now; online sales reached $9.91 billion...
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...Business Information Systems BIS/219 August 17, 2010 Xuan Yu In this team paper we will be discussing the strategies of Amazon.com to see whether the Internet icon is moving away from being the number one leader online. We will be showing different areas to see if Amazon.com is using the right strategy to compete with Google and Microsoft. We find the different issues concerning the database and data management with Amazon.com. Finally we will be discussing the uses of e-business and e-commerce for the B2B and B2c. As of January 2010, Amazon.com was considered the largest online retailer in the United States. Amazon was launched in 1995 by its founder Jeff Benzo. Benzo’s original idea was to create an online bookstore. Compared to traditional bookstores or even mail-order systems, an online retailer could carry a far greater quantity of books for sale. Just like most businesses, even the traditional bookstores, Amazon expanded its business past just books and began adding an array of items; ultimately making its way to selling almost anything possible. Stockholders of Amazon.com, knew the turn over would be a rather slow process with the gradual growth of online sales, but none-the-less they would expect a profit. It took Amazon until its fourth year to produce any revenue and finally to hold its ground as an online retailer. This slow progress made Amazon move away from its original concept...
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...Amazon.com - Financial Analysis Case Study Introduction The bookselling industry is one of the steady growing industries which have estimated the sales of $27 billion in the year 2006. The sales of the books highly depend on different seasons. The industry has diverse customers who buy different categories of books which includes the trade books, college books, professional books, mass market paper-back books. With stiff competition across the market, the companies are strongly focusing on adopting different ways and means so as to attract more and more consumers and achieving high market share in the industry. Company overview Amazon.com is considered to be the market player in the e-commerce industry (bookselling). Amazon.com was founded by Jeff Bezos, who focused on enhancing the book shopping experience of consumers, with innovation and new ways to sell books online. One of the major players of Amazon.com is Barnes and Noble. Amazon.com started as an online bookstore that has turned into one of the largest online retailers selling items from music and movies to artwork and furniture. As the company website states “it is by design that technological innovation drives the growth of Amazon.com to offer customers more types of products, more conveniently, and at even lower prices.” In this paper you will learn the financial health of the company Amazon.com. The 9-step process written about by Professor Piper will be followed to assess how financially sound Amazon.com...
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...Amazon Reflection Amazon Reflection Denise Newton, Latisha Chavez, Trevor McMillan, Platinum Plus, Victor Wong BIS/219 January 30, 2012 Sharyn Deeringer Amazon Reflection There have been many companies that have succeeded by finding there nitch in their perspective business. Amazon.com is no different. With their line of tablets called the Kindles, Amazon.com has revolutionized the way we read books. In our summary we will discuss the company Amazon.com to see if the company is moving away from its normal ways of business and being the top retailer in the business. Also we will discuss other companies such as Google and Microsoft, give a brief history and also see what these companies have to offer. Furthermore we will identify how Amazon .com is competing in certain areas of its business and evaluate if it was a wise strategy. Amazon is the largest online retailer and they intend to stay on top. Companies have to adapt to the market if they want to keep selling and stay profitable. With the down economy Amazon has realized they can not only make money by consumers purchasing off of their site. Amazon has a large amount of storage space on their network and server that is not being used. As a way to receive more revenue Amazon allows other companies to take advantage of their large servers by charging for disk space used. This is a great way to make money and it does not involve a lot of cost to Amazon. They do not have to buy any product...
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