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2012

E-commerce Amen Mukhlis

[E-COMMERCE]
A comparison between two types of retailers, Amazon a retailer that started as an online retailer and started to have physical presence Vs. Wal-Mart the largest retailer in the world whom incorporating an online business unit in their operations.

E-commerce

The E-commerce and online business has been a huge subject since the beginning of the world wide web in 1990s, we have seen lots of companies start online and others shift towards the online business either by adding the online business to their operations or going completely online. In this paper the choice was to examine the Retail market where companies like Amazon.com reported 48 billion dollars of sales on their annual report (SEC-AMZ, 2011) Amazon The first online retailer to start the online business in 1995 when the company's Founder Jeff Berzot, started the company from his home garage selling books and shipping them, Berzot moved from New York City to Seattle WA and wrote the business plan for the online book store on the road from NY to WA (Webley, 2010)

"The first known Web purchases took place in 1994. It was a pepperoni pizza with mushrooms and extra cheese from Pizza Hut" (Webley, 2010) the company today is 17 years old with the title of the largest online retailer and one of the largest retailers in the world threatening other retailers like Wal-Mart and Target.

The Advantages of online retail      Larger base of customers Easier to market and promote Less employees, and third party involvement Less cost with inventories, and the risk associated Manageable system, self tracking since all activities is done through computer and registered and the data is manageable and sharable

Amazon has depended on a unique system to eliminates all the risk associated with carrying inventories, having an exceptional relation with their suppliers, that allows them to make the merchandize available at all time Amazon recently started to have physical presence initially as a warehouses in many states and the reason is that the company wants to compute with those of brick and mortar where they still kept an advantage in the groceries, Amazon is hoping to gain more customers with their one day cheap shipping and to gain a new layer of customer by offering same day groceries a model that has been tested in WA. Wal-Mart The retailer that started from the Walton 5-10 store in 1950 is today the largest retailer with 447 billion dollars in sales and 6800 stores (Walmat, 2011) Wal-Mart is best known for its big-box stores, but the retail giant has positioned itself for a future where e-commerce plays a larger role by instituting management and structural changes. The company IN 2010 created a business unit called Global.com, responsible for driving online growth in the US and internationally. The unit will focus both on regions where e-commerce will operate alongside bricks-and-mortar stores and areas where there are none. (McKeefery, 2010) The company's need to enter the online market is to pursue new customers as well as keep the current customers where the company enjoys 200, million costumers weekly

References McKeefery, K. (2010, 02 15). http://www.dmnews.com/walmart-restructures-to-boost-ecommerce/article/163641/. Retrieved 07 24, 2012, from http://www.dmnews.com: http://www.dmnews.com/walmart-restructures-to-boost-e-commerce/article/163641/ SEC-AMZ. (2011). http://www.sec.gov. Retrieved 2012, from http://www.sec.gov: http://www.sec.gov/Archives/edgar/data/1018724/000119312512032846/d269317d10k.ht m Walmat. (2011, 12 31). http://www.walmartstores.com/sites/annualreport/2011/. Retrieved 07 24, 2012, from http://www.walmartstores.com: http://www.walmartstores.com/sites/annualreport/2011/ Webley, K. (2010, june 16). http://www.time.com/time/business. Retrieved 07 24, 2012, from http://www.time.com: http://www.time.com/time/business/article/0,8599,2004089,00.html

Appendix

http://mashable.com/2011/06/21/amazon-walmart-infographic/ The link details a full comparison between the two retailers that is really interesting and useful.