Case 3 – Chapter 12 (Amazon.com)
Provide a high-level overview and history of the company.
Amazon Company is a fortune 500 e-commerce firm that is based in Washington and is mainly known for the sale of products over the internet. It was founded by Bezos in June 1995 when it commenced its services as an online bookstore. Amazon, according to Business Insider was initially to be called Cadabra. However, Bezos’s lawyer commended that reference to the firm magic might be too obscure. Moreover, when heard about the name, they termed the name as not ideal. So Bezos together with his wife started to register domain names such as Bookmall.com, Browse.com, and Awake.com. For their new venture. After scrolling via the dictionary, they found an inspiration word, Amazon. Bezos thought that the word was perfectly fit for use since he envisages his new venture becoming the biggest online store worldwide.Hence, they named their new venture Amazon. Today, Amazon.com is widely known as an online shop, web service provider that is an iconic example of a seller of electronics as well as a manufacturer of electronic book readers. The retail shop sells its products either via middlemen between other companies or directly. Some of its web service operations include cloud computing, renting, and data storage. The firm also makes other products such as Kindle ebook readers. Its sales and promotion of such devices have led to its significant growth in the publishing of e-books.
What differentiates Amazon from other large box retailers (e.g., Wal-Mart, Best Buy)?
I do feel that Amazon company differentiates itself from other large box retailers such as Best Buy and Walmart in the following ways;
Innovation
Typically, Amazon seems to be matching with retailers such as Walmart with new motives as well as innovation step for step. Unlike other retailers, Amazon did launch its Go convenience stores where its clients can simply pick up the products they want and walk out of the shopping premise without a cashier. Again, Amazon is leveraging robots at its fulfillment centers. Besides, it has started using autonomous robots to enable it to deliver products in select markets. The firm has also expanded its fashion which now includes trying before you purchase clothes via prime wardrobe. Consequently, the firm has been digging into offers in-home consultations and smart home space for some clients. Its web services have also expanded its cloud offerings to enable it to connect with more customers.
Customer Focus
As compared to other large retailers, Amazon has a customer experience, as well as a customer, focused culture. The firm had been ranked the top spot for being the best company with an excellent customer-focused culture. Mainly, Amazon is regularly named as the top retailer in this sector and other retailers emulate its model since client centricity is the fundamental value of a firm. Amazon’s company self-help is not paralleled and its digital experience, as well as convenience, has raised the bar for the whole industry.
Broader Product Options
The firm has broader product options through a market place as compared to other retailers who focus on a single or few products. The company offers a variety of products which enable it to allure as many clients as possible. It sells music, movies books, toys, electronics, and other products. Amazon Web service business offers data storage computing resources as well as renting.
Amazon also high competitive pricing of goods which are based on the supply chain as well as in-house inventory model. As compared to other retailers, Amazon utilizes technology as well as the organization as organization silo. In this case, Amazon company worked in the cross-functional regions, and hence possess superior information facilities as compared to other competitors. Lastly, Amazon mainly concentrates on the developing markets in other nations.
What changes is Amazon planning in the future to improve inventory management and distribution?
Amazon is a big E-commerce firm which has been outstanding in the market for several years.
This is due to its good business approach, good management of inventory as well as meeting the needs and demands of its clients on time in all seasons. The firm is now taking it a notch higher by enhancing its inventory management as well as its distribution system to enable it to cut down both the distribution cost and inventory storage costs to maximize profits.
The firm is also focusing on launching the Amazon Prime Now system mainly in its distribution system to enable it to deliver products to its clients on the same day or even in two or three hours. Currently, due to a lack of fulfillment centers in the nearby locations, this change is at a small level.
The other change is maximizing the numbers of its fulfillment locations in most cities to enable it to store additional inventory without causing any damage and also enable it to accomplish its master plan of Prime Now to enable it to deliver products in one or two hours. Again, Prime Now strategy is now available from 6.00 am to midnight, every seven days a week. Also, a two hour delivery of products is now free and the one-hour delivery is now available at 7.99 dollars.
Typically, in the past, Amazon Company has identified that poor delivery is causing clients not to return to the brand. Upon recognizing this, the firm now plans to offer its fulfillment program (FBA) to assure selling products fast and accurately, as well as affordable shipping for its clients.
Lastly, is the use of drones in delivering its products on the door of their clients. This is what will be now called Prime air to enhance the distribution of its products.Again, if Amazon’s company can implement drone deliveries, e-commerce could be revolutionized by technology hence making online shopping much faster and even easier.
Describe Amazon’s global strategy for managing inventory between countries.
Amazon Company employs a global; delivery network that enables it to control the flow of its products from the factories worldwide to the doorsteps of its customers. The firm plans to the freight forwarders as well as the bypass brokers by acquiring inventory from many merchants across the globe and then purchasing spaces on ships and planes at reduced rates. In the past few months, the firm, according to Supply, commenced handling the ocean shipping of containers to its fulfillment areas from the Chinese merchants’ vendors on-site, hence taking on a role that it had left previously to global freight transportation firms.
References