...headquarters and warehouses. It receives payments from its customers on an average of 17 days before it has to pay its suppliers. Inventory Velocity – Averages 16.5 times per year. Technology - Uses information technology to execute supply chain on a large scale to realize economies of scale making its gains in capital efficiency and inventory velocity possible. • Run its warehouses as efficiently as possible. It is so high tech that its ERP has complex algorithms that can analyze relationships among the items customers purchase to find groupings that can be located in the same warehouse, thus reducing shipping costs. Warehouse operating costs has dropped from 20% of revenue to less than 10%. • Optimizes delivery performance and enhances service reputation that minimizes distribution mistakes. • Offers its retailing and supply chain management services to more than 1.1M other retailers both large and small. Amazon.Com’s Competitive Advantage • The heart of Amazon.Com’s business model is information technology. It has been investing an average of 7% of its sales. • Some argue that Amazon has built “a stack of software on which thousands or millions of others can build businesses that in turn will bolster the platform in a self-reinforcing cycle.” • Amazon strives to be “earth’s most customer-centric company” focusing on selection,...
Words: 1843 - Pages: 8
...thousands of other items. Jeff Bezos founded Amazon.com in 1994. Originally the business was based out of his garage in his Bellevue, Washington home. A businessman by the name of Nick Hanauer believed in Bezos' idea and decided to invest $40,000 in the venture. When Amazon first decided to go online, its layout was not as flashy as it is today. In fact, the site looked very plain and unattractive to most visitors, causing the business to start out on shaky ground. At the end of 1999, Amazon had raked in over a billion dollars in sales. It seemed as though the profit would never cease. However, in 2001, Amazon reported a fiscal loss of $1.4 billion, and had laid off over 200 workers in the last year. The beginning of 2001 found Amazon laying off even more workers, totaling over 1000. Instead of giving up, Bezos had an idea: recruit other companies to sell their products online through Amazon as well. The idea worked. Companies such as Target, Toys R Us, Old Navy, and many others have agreed to sell their items through Amazon. Although Amazon is not directly responsible for inventory through these companies, they do get part of the sales, creating a profit for all involved. Since the inception of the idea, Amazon is now back on its feet and remains one of the most popular online vendors in the...
Words: 1924 - Pages: 8
...Jeffrey Wilke, senior VP of worldwide operations at Amazon.com Inc. "All three depend critically on the supply chain." Amazon has one of the most-sophisticated supply-chain systems in the world, and it was all built from scratch. Homemade applications handle nearly every aspect of its supply chain: warehouse management, transportation management, inbound and outbound shipping, demand forecasts, inventory planning, and more. "We don't have any legacy systems," Wilke says. "That's a clear advantage." In the last four years, Amazon has worked to minimize the need for human intervention in its supply-chain processes, such as manually inputting sales forecasts into an inventory-management system. Today, Amazon's supply-chain apps communicate in real time, a rarity when most companies have to integrate a variety of software tools and manual processes, such as phone and fax orders. "We've reached a point where computers do what they're supposed to do," Wilke says. Amazon's supply chain is so tightly integrated that when an online customer buys a couple of books and a CD, the order-management system communicates with inventory and warehouse-management systems to find the optimal distribution centre or centres for fulfilling the order. The customer knows in less than a minute how long it will take to ship the items and whether they will come in one package or separately. Amazon, which spends about $200 million a year on business technology, last year launched a business unit...
Words: 394 - Pages: 2
...and explain their supply chain strategy. Amazon is one of the leading online retailers in the world. From foundation, Amazon was an online book retailer. Their online success allowed them to move into other areas including e-books, music and other products. Jeff Bezos, Founder, started the business in his garage and has built the company on an unconventional business model that in my opinion gives Amazon a competitive advantage. Amazons business model consists of a combination of logistical processes and information services that work together to provide a sustainable competitive advantage. Amazon provides shopping convenience to consumers, products can be ordered at the click of a button without the hassle of the retail store experience. Consumers experience an easy purchasing experience with a variety of payment methods such as paypal, bill me later, and credit card payments. As an added convenience consumers can set up accounts and save payment information for future purchases. Amazon has a very fast turn-around time for items fulfilled in Amazon fulfillment centers. In many cases consumers can expect their products to be shipped within a 24 hour period. As an additional service to consumers, Amazon provides what they call “decision enabling information”. Amazon compares products and pricing, provides consumer product reviews and ratings, and provides detailed product descriptions to aid consumers in making the best product purchase decisions. Amazon also has a wide selection...
Words: 1055 - Pages: 5
...and fulfillment centers with an excess or 3+ million shoes, handbags, clothing and accessories, offering the best selection of shoes available anywhere (one stop shop) o Uses eCommerce for the transaction between business to consumer o Best customer service experience, employing approximately 1,600 workers o Offers free delivery and returns as well as a guaranteed 4-day delivery window and a 365-day return guarantee. o Innovated Company that kept culture and work environment ‘fun’ and relaxed. 2. Please complete the following table. Identify the key information systems and the related IT infrastructure investments that enable Zappos’ core business processes: Core Business Process Information Systems IT Infrastructure supplier management [an example response is attached; feel free to add to, modify or delete this example and create your own response] • customer orders processing system • customer returns processing system • procurement system • SCM system • CRM system • PRM system • online,...
Words: 832 - Pages: 4
...Amazon Supply Chain Management Student Name Course/Number Date Instructor Amazon Amazon is a Fortunate 500 company which was incorporated in 1994 and went online in year 1995.it has been listed in NASDAQ national Market since 1997.Company objective is to provide it customer product at low cost, convenience and with lot of options to search. It started as book retailer and then extended its product and offerings to other parts of country. Amazon is the largest internet retailer since 2000.Company focus more on innovation due to which it has become market leader in e-commerce segment(Mirow, 2005). Business Strategy of Amazon The business strategy of the company is to make itself the best place for the customers to buy products and to discover new products which will be available online. The business strategy of the company focuses more on providing value to each customer by creating disruptive technology innovation and provides products at the lowest cost to the customer with in specified time. There are various steps company has taken to implement its business strategy like providing better search options, reviews of the customers, recommendations, secure payment services and assuring on time delivery by focusing on availability and transportation (UNSEC, 1998). Supply Chain Strategy of Amazon Amazon followed excellent supply chain strategy .It focused on increasing the number of warehoused and also it established excellent inventory management system to...
Words: 605 - Pages: 3
...Walmart: Supply Chain Management Walmart was founded in 1962 by Sam Walton and is considered one of the global giants in supply chain management. The company has become the world’s biggest retailer with the largest amount of sales per square foot, the highest inventory turnover rates, and net operating profit of any of its major competitors. This powerhouse manages approximately $32 billion in inventory and stocks products manufactured in more than 70 countries worldwide. With these kinds of numbers, it is vital that Walmart is able to continue to effectively and efficiently run its supply chain. The organization is dedicated to a business strategy that drives out costs and enables consumers to save money and live well. The way in which Walmart conducts business is distinctly different from its rival, Amazon, who also dominates the North American and global retail environment. Walmart has found continued success by working with fewer links in its supply chain, expanding strategic vendor partnerships, utilizing cross docking to replenish inventory, and embracing technology to track and restock inventory. Additionally, the company has made great strides in developing a highly structured and advanced supply chain by meeting customer demands and achieving cost structures that allows them to provide low everyday pricing on products. As with any company, Walmart has faced many challenges within its supply chain and continues to execute strategies to overcome such challenges. In...
Words: 2674 - Pages: 11
...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...
Words: 3354 - Pages: 14
...Strategy In January 2003, Tom Taylor, Amazon.com’s Director of European Supply Chain Operations, sat in his office in Slough, United Kingdom, and pondered what changes Amazon needed to make to sustain its growth in Europe. Established in the fall of 1998 through the acquisitions of two on-line Logistics Planning & Modelling Techniques booksellers, Bookpages.co.uk in Britain and Telebuch.de in Germany, Amazon.com’s European Distribution Strategy International, comprising Amazon Europe and Amazon Japan, now Amazon Europe had developed into three strong, independently run, country-based organizations in the UK, Germany, and France. Amazon represented 35% of Amazon revenues and was the fastest growing segment of the company (see Exhibit 1). Amazon.com’s European Distribution Strategy Amazon.com’s European Distribution Strategy Amazon.com’s European Distribution Strategy Amazon.com’s European Distribution Strategy To sustain its growth, Amazon Europe faced multiple expansion Taylor felt that a lot had been accomplished since his arrival six months options: it could replicate the broad array of product lines Amazon earlier. His team had managed to standardize and improve supply offered in the US, launch new Marketplacea activities, or expand into chain processes across Europe in the areas of vendor management, other European countries. In addition, Amazon Europe had to decide sales and operations planning, customer backlogs...
Words: 9071 - Pages: 37
...Running Head: Amazon Global Organization Amazon Global Organization Supply Chain Management Instructor - Adrian Martin January 10, 2015 Tericka Cameron INTRODUCTION As a start-up company in the garage, Amazon Supply Chain has made a giant leap that revolutionized many aspects of overall supply chain management. With more than 130 million stocking keeping units to manage and millions of transactions to control. E-commerce has revolutionized the world of retail, opening new channels and opportunities for retailers of all sizes. You can take advantage of the phenomenal growth in retail sales conducted over the Internet by expanding your business globally with Amazon. Amazon has marketplaces around the world—United States, Germany, United Kingdom, France, Italy, Spain, Canada, China, and Japan—and the services and tools to help guide you through the global selling process. Evolution of Amazon’s Global Supply Chain Amazon care so much about customers and holds employees to a high level of customer service requirements. In many internal meetings, Jeff Bezos (founder) leaves one empty chair next to him and tell people that they should also think on behalf of one important customer who can't manage to be there. Then the word "empty chair" becomes a symbol of customer centric business practices inside Amazon. Also, many senior executives have to attend call center training so they can know customer's feedback, good or bad, firsthand. Many companies focus on benchmarking...
Words: 984 - Pages: 4
...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...
Words: 2951 - Pages: 12
...Unit Outline* | TRLO8506| Supply Chain Management| | | D4B-OFFShanghai| | Dr Min Qiu| Business School www.business.uwa.edu.au * This Unit Outline should be read in conjunction with the Business School Unit Outline Supplement available on the Current Students web site http://www.business.uwa.edu.au/students TRLO8506/Shanghai/MQ/15.04.11. | | All material reproduced herein has been copied in accordance with and pursuant to a statutory licence administered by Copyright Agency Limited (CAL), granted to the University of Western Australia pursuant to Part VB of the Copyright Act 1968 (Cth).Copying of this material by students, except for fair dealing purposes under the Copyright Act, is prohibited. For the purposes of this fair dealing exception, students should be aware that the rule allowing copying, for fair dealing purposes, of 10% of the work, or one chapter/article, applies to the original work from which the excerpt in this course material was taken, and not to the course material itself.| © The University of Western Australia 2011| UNIT DESCRIPTION Introduction Welcome to the study of supply chain management. The unit and the instructional material have been developed to cover a wide range of issues in supply chain management, which lays a foundation to study specific topics or techniques of logistics and supply chain in depth. The objective of the unit is to enable students to achieve an understanding of the terms, concepts,...
Words: 2170 - Pages: 9
...INNOVATION AGILITY DECISIONS INVESTMENT SUPPLY Want to Innovate? The supply chain discipline is replete with rules that most managers live by. But in certain cases, true innovation and breakthroughs come only when those conventional rules are broken. By clearly understanding the nature of the rules and the details of your supply chain, you can better determine where and when rule-breaking makes sense. By Robert Sabath and Richard Sherman Robert Sabath and Richard Sherman are Supply Chain Discipline Experts at Trissential, a management consultancy focused on business improvement. They can be reached at bsabath@trissential.com and rsherman@trissential.com. F rom college courses to on-the-job training to professional seminars, we’re taught that supply chain is a complex set of processes that follows specific rules to achieve the best results. Yet most supply chain innovations and breakthroughs evolve from situations where the basic rules were actually broken or changed. Is there a disconnect? Breaking the rules has to do with knowing when it’s beneficial to make an exception to accepted practice or to challenge the conventional answer. It entails scanning the horizon for new technologies, best practices, or approaches that change the paradigm of how we do things. Winning companies often excel because they saw a situation differently and were willing to take the risk and the initiative to break with the accepted logic. Innovation is all about breaking the...
Words: 4370 - Pages: 18
...INTRODUCTION Order fulfillment and delivery of products to customers are tricky parts of supply chain management. Earlier in 1990s, there was pull system in use and later it changed to push- pull system in order fulfilment. This change in system of order fulfillment was to increase margins, service and also to cope with the increase in volume of the orders. Order fulfillment does not confine to just delivering the ordered goods to the customers, but also provide all related customer services. In simple terms, along with the product, product information and usage information should be provided with the product. In addition to this, to maintain customer retention and satisfaction, there should be a system of exchange or return if desired by the customer. Order fulfillment includes several operations such as inventory management, packing, shipping, delivering and accounting. Hence, most of the operations involved are dealt without having to face the customers. TYPES OF ORDER FULFILLMENT Order fulfillment is of two types based on the usage of the process at a particular period of time. There is a conventional or traditional order fulfillment and E-commerce order fulfillment process. Traditional retailing of supply chain was used at the time of 1990s. In traditional retailing, inventory production is initiated at first and later is followed by pushing the product to customers. So, it begins with pulling and ends with pushing the product to customers. e- Commerce retailing deals...
Words: 1999 - Pages: 8
...Inventory Management Professor Operations Management BUS430 February 26th, 2015 Managing inventories is integral to a company’s success. Having too much inventory can cost the company a lot of money and having too little can be costly by losing out on customers. It is a juggle for managers to find the right balance in accurately managing inventory. Not only do they have to make sure that they can meet the demand of the customer but they also have to cost effective. Two companies that manage inventory well and still make a profit are Amazon.com and Zappos. Amazon.com is an online company that was founded by Jeff Bezos in the 90’s. Amazon.com sold books online during the early internet years. In a short amount of time it was a success. At the beginning, “Amazon.com carried only about 2,000 titles in stock in its Seattle warehouse”. (Amazon.com, Inc., 2015) Their inventory at that time was very simple compared to how it is now. To stay on top of the competition, Amazon diversified from just selling books online to other products like DVDs, toys, clothing, electronics and just about anything you can think of. Having multiple merchandise requires a strategic central location where the items can be shipped to the customer. Amazon houses their inventory in different states across the country. In order for them to have a variety of items to sell, they have other companies sell their products through the Amazon website and Amazon will fulfill the orders. Amazon has fulfillment...
Words: 2012 - Pages: 9
