By : Poojasree.

K
312016624
Supply Chain Management
Report of the Project
Title of the Project : AMAZON
 INDEX
• WHAT IS SUPPLY CHAIN MANAGEMENT?
• INTRODUCTION
• SCM of Amazon
• PROCESS OF SCM IN AMAZON
• AMAZON SCM NETWORKS
• 6 WAYS AMAZON IS CHANGING SCM
• AMAZON DEALERS
 What Is Supply Chain Management?

o Supply Chain Management (SCM)

encompasses all the processes integrating
suppliers to integrate efficiently together
to move a product from creation to the
customer’s hands, considering supply and
demand along the way.

o Describing Amazon supply chain strategy

and innovation, Amazon’s AWS writes:
“Today’s supply chains are global
networks of manufacturers, suppliers,
logistics, and eCommerce/DTC retailers
that work together to deliver products to
the end customer.
 INTRODUCTION

 Amazon is an American electronics commerce organization, founded in the year 1994.

 Developed with the vision of entrepreneur Jeff Bezos, the company has been able to
develop a strong global brand image.
 The success of Amazon has been based on the capitalization of the e commerce related
consumer demands.
 The supply chain function has a crucial impact on the operational ability of the
company, as the customers expect to receive their online purchased products in a time
efficient manner (Bradley et Al, 2012).
 The company initiated its operational activities as an online book store, however over
it expanded the product range by offering the customers with diverse consumer
electronics’ products.
 Supply chain management of Amazon company

 The term Amazon supply chain essentially refers to Amazon's

entire process from product warehousing to inventory
management, pricing ,delivery, and more.

 Amazon has optimized each of these elements to ensure that

everything is workingsmoothly and efficiently

 Today’s supply chains are global networks of manufacturers,

suppliers, logistics, and E-Commerce/DTC retailers that work
together to deliver products to the end customer
Process of SCM in Amazon
Amazon’s Supply Chain Network

•The supply chain function of Amazon has a major impact on the

performance and the customer satisfaction levels.
• As an online retail organization, the company has to ensure that
it can offer its customers with an efficient and value added
service (Disney et Al, 2004). The Amazon customers have high
levels of expectations from the company, which are satisfied
Amazon Supply Chain Network 3 through the dynamic supply
chain function.
•The supply chain of Amazon consists of various diverse
components, which operate collaboratively to achieve the
collective objectives.
•The supply chain function is based on the overall capability of
the organization to source the materials, and deliver the final
products to the end customers.
• Logistics & Transportation

Logistics and transportation is a major component of the

supply chain function of Amazon, as it has a direct impact on
the customer satisfaction levels.

The company has a highly efficient distribution system, through

which it is able to diminish the delivery leadtimes. Amazon also
provides 3PL services to the customers, based on its vast
expertise and knowledge.

The company has also invested in the innovative delivery

drone systems, called the Amazon Prime Air; which would help
deliver the products to the customers within 30 minutes.
 
• Customer Service Management
The achievement of high levels of customer satisfaction
and services, are core aspects of the Amazon operational
activities.

The company achieves the high level of customer service

standards through the development of an effective online
and physical customer support network.
• Demand Management/Knowledge Management

The demand management function of Amazon is focused on

attaining the maximum amount of information regarding he
customers, to provide a personalized level of products/services to
the customers.

The online platform is a highly unique platform, which

can provide the organization with diverse information regarding the
customers.

The Amazon management utilizes this platform to analyze the

personal demand of every customer, and hence provides the
relevant value added consumption experience to the customers.
• Inventory Management & Purchasing
 
Amazon possesses a vast network of warehouses in order to
maintain the inventory for its growing customer market.

In the recent years the product range offered by the company has
increased leading to a larger warehouse function demand.
The company utilizes various inventory management soft-wares,
to optimize the function and reduce the overall costs.

The sourcing strategy of Amazon is based on large scale/bulk

buying, through which the lowest costs can be offered to the
customers.
 6 Ways Amazon Is Changing Supply Chain Management

• Continuous Fulfillment
• More Intensive Management
• Better Automation
• Bigger Warehouses
• Last-Mile Logistics
• Reversing the Inventory and Logistics Dynamic
 1. Continuous Fulfillment

Customers are no longer satisfied with a

distribution company that collects orders and
fills them at the end of the day. Online
marketplaces are open around the clock, and
people often want overnight or next-day
delivery. That means a system must be in place
to process orders immediately, so the delivery
company can pick up the item from the
warehouse and send it down the line right away.
 2. More Intensive Management

Naturally, more order fulfillment and faster

distribution will require more management and
better inventory control. Distributors must hire
competent management personnel, often using
state-of-the-art logistics software, to make sure the
accelerated supply chain continues to function
effectively at all times. Multi-tier inventory
management can help companies reduce overall
delivery time and remain competitive in the online
marketplace.
 3. Better Automation

Automation is already a critical part of most

shipping supply chains. With around-the-clock
deliveries, your automated processes need to
be faster and more efficient. The future of
supply chain automation will see robots
completing most warehouse activities without
human assistance. Suppliers must invest in
state-of-the-art machines and automation
technology to keep up with demand.
 4. Bigger Warehouses
Companies that find themselves having to
search for or manufacture new products when
customers order them will fall behind.
Companies need to have spacious enough
warehouses or a large enough number of
warehouses to contain as much inventory as
they need, ensuring there will always be
enough products to fulfill any order at any
time.
 5. Last-Mile Logistics

Companies need to make sure they have big enough

warehouses

Getting a product that “last mile” — that bit of distance

from the local receiving center to the recipient — on
time has always been a challenge, but it is one that
Amazon seems to have mastered. Depending on third-
party logistics tends to lengthen the overall delivery
time. That’s why Amazon primarily relies on its fleet of
vehicles to meet increasingly fast delivery promises.
Today’s supply chain managers must find new and
innovative ways to cross that last mile.
6. Reversing the Inventory and Logistics Dynamic

In the past, many companies have had a strategy of

outsourcing logistics and insourcing inventory. It
means using their in-house products but taking
advantage of third parties all along the supply
chain to deliver them.
Amazon’s fulfillment centers do the opposite,
offering many products that sit in other parties’
warehouses while managing their own extremely
efficient logistics system to get those items to
their locations.
 Amazon’s Dealers
• OnePlus • FireStick • Bags, Wallets and
• ASUS • Workman Luggage
• Xiaomi • AudioControl • Beauty
• Redmi • Rostra • Books
• Gear Keeper • Advent • Car & Motorbike
• BCW • iDatalink Maestro • Clothing & Accessories
• President Electronics • Any Department • Computers &
• Maestro • Amazon Launchpad Accessories
• Ranger • Apps for Android • Electronics
• Uniden • Audible Books & • Garden &
Originals Outdoors
• Supco
• Baby Products • Gift Cards
• FireStik
 THANK YOU

By:Poojasree.K