Contemporary

SCM

Assignment-1
Introduction

Business world has never been the same since the

incepti on of Amazon. The e-commerce enterprise
started as a bookstore in 1994 and found surprising
popularity. Its success allowed it to expand and
transform into the “everything store” in its literal
sense.
Today, Amazon is widely considered as having the
best online site available which even other
competi tor sites such as Walmart have not been
able to catch up to since 2015.
Current Business Model
Current Business Model
Current Business Model
REVENUE GENERATING
REVENUE GENERATING
 Inventory & Stocking model

 Amazon Inventory management aimed at following strategies:

•Maintain inventory of millions of items.
•Shipment within one week.
•Have a clear understanding of customer ’s delivery needs.
•Coordinate with wholesale suppliers and independent producers
to make available to customers both current and the soon to be
released books.
•Provide two day delivery on most orders.
•Allow customers to query the status of their purchases and track
their own shipments.
 Inventory & Stocking model

Amazon Inventory management- Technology usage

•The Central Ama zon Data warehouse is made up of 28 Hewlett Pac kard ser vers, with fou r CPU s p er
n ode, ru n nin g Ora c le 9i data base soft ware.
•The arc h itec ture ha nd les millions of bac k-end operati on s a nd third p arty seller qu eries.

Amazon has Strategic Alliances with many vendors for procuring various products.
•Ashford.com( Online retailing of luxury and premium products )
•Drugstore.com (Online retail and informati on source for health, beauty, wellness, personal care
and pharmacy).

Implementati on of Inventory Management:

•Amazon aimed at ‘hassle-free operati ons’, customer sati sfacti on, ti me and cost effi ciency.
•Amazon managed to reduce the size of its inventories because of effi ciently managing the
warehouse.
•Careful decision about ‘product ’, ‘supplier ’ & ‘distributi on center ’ i.e. ‘which product to buy ’,
‘from where’ & ‘which center it would send its product to’.
•Huge investment in infrastructure (revamped the layout of its warehouse) and technology
(refi ning its soft ware helped in demand forecasti ng)
•Aimed at cutti ng down expenses via outsourcing some of the routi ne acti viti es.
Brick & Mortar Model Vs Market Place Model
(Rati onality).
 Conclusion

• Amazon is a tech gi ant. When it started back in t he 1990s, it began as an onli ne

bookstore. Today Amazon is t he store that sell s any thi ng imagi nabl e. As
its founder, Jeff Bezos has specifi ed Amazon is a customer-centri c company.

• However, it is clear that what made and makes Amazon so compell ing is the 
business model and which generates  value for several players.

• Consumers fi nd products at a lower price and get them fast. Sell ers can fi nd new
market opport uni ti es or decide not to carr y any inventory. In fact , Amazon has its
own fulfi ll ment center that manages the inventori es for sellers.