Supply chain management of amazon

1. PROJECT OF ECOMMERCE

2. PRESENTATION PRESENTED BY :

3. RAUNAQ SINGH

4. INDEX: 1. INTRODUCTION OF SUPPLY CHAIN MANAGEMENT 2. EXAMPLE OF SUPPLY CHAIN

MANAGEMENT 3. INTRODUCTION OF AMAZON 4. SUPPLY CHAIN MANAGEMENT OF AMAZON .
ANALYSIS OF AMAZON SUPPLY CHAIN MANAGEMENT PRACTICES 5. MULTI TIER INVENTORY SYSTEM 6.
DIAGRAM AND PROCESS OF SUPPLY CHAIN MANAGEMENT OF AMAZON 7. AMAZON SUPPLY CHAIN
STRATEGIES 8. ADVANTAGES OF SUPPLY CHAIN MANAGEMENT 9.DISADVANTAGES OF SUPPLY CHAIN
MANAGEMENT .

5. 10.RECOMMENDATIONS TO IMPROVE SCM OF AMAZON 11.Amazon And Alibaba Bet The Future On
Supply Chain Management: eRetailers Invest Big In Logistics 12.What Amazon is doing with its supply
chain could devastate the competition 13. Amazon selects infro for global logistics business 14. Some
facts about amazon 15. Conclusion 16. References

6. SUPPLY CHAIN MANAGEMENT OF AMAZON

7. supply chain management (SCM), the management of the flow of goods and services , involves the
movement and storage of raw materials, of work-in- process inventory, and of finished goods from point
of origin to point of consumption. Interconnected or interlinked networks, channels and node
businesses combine in the provision of products and services required by end customers in a supply
chain. Supply-chain management has been defined as the "design, planning, execution, control, and
monitoring of supply chain activities with the objective of creating net value, building a competitive
infrastructure, leveraging worldwide logistics, synchronizing supply with demand and measuring
performance globally."

8. SCM practice draws heavily from the areas of industrial engineering, systems engineering, operations
management, logistics, procurement, information technology, and marketing and strives for an
integrated approach. Marketing channels play an important role in supply chain management The term
"supply chain management" entered the public domain when Keith Oliver, a consultant at Booz Allen
Hamilton (now Strategy&), used it in an interview for the Financial Times in 1982. The term was slow to
take hold. It gained currency in the mid-1990s, when a flurry of articles and books came out on the
subject

9. Amazon.com, Inc. is an American multinational electronics commerce company with headquarters in

Settle Washington, United States. It is the world's largest online retailer. They started as an online
bookstore but have diversified to so many other products like music downloads, furniture, food and
basically almost all consumer electronics. Currently, Amazon is a major a provider of cloud computing
services. Amazon’s has a separate retail online stores for different countries for example the USA, UK,
China, Italy, Germany and others. In 2015, Amazon surpassed Walmart as the most valuable retailer in
the United States by market capitalization,[19] and is, as of 2016 Q3, the fourth most valuable public
company AMAZON

10. Analysis of Amazon’s Supply Chain Management Practices

11. To start with, Amazon’s SCM has a strategic fit with its competitive strategy of being the retailer of
choice for its customers. The combination of multi-tier inventory management, superlative
transportation, and highly efficient use of IT (Information Technology), and its wide network of
warehouses are all geared towards aligning its SCM with its competitive strategy. The next aspect is
related to its outsourcing of its inventory management. Amazon outsources the storage and distribution
of products that are not frequently purchased nor ordered for immediate delivery as well as products
where the costs of storing them exceed the marginal returns on their sales.

12. Any discussion on Amazon’s SCM is incomplete without an analysis of its multi-tier inventory system.
The first tier is the aggregation in the distribution centers, which ensures that Amazon holds fewer
inventories and responds to demand in a dynamic manner. The next tier is comprised of the partner
distribution centers and the wholesalers wherein whenever an ordered product is not available in its
own distribution centers; Amazon can rely on its partners and wholesalers to supply the customer with
the required product. Further, through the use of sophisticated and real time IT, Amazon is able to
leverage efficiencies in its distribution. The third tier is comprised of the networks of third party sellers,
publishers, vendors, and manufacturers who ensure that Amazon acts as an intermediary that fulfills
orders from customers by linking them to this tier.

13. PROCESS OF SUPPLY CHAIN MANAGEMENT IN AMAZON Amazon’s supply chain process is simple, yet
effective. 1. It starts with the customer placing an order. 2. The order prompts a red light to come on in
the warehouse which shows the worker the products that have been ordered, and the bar code is
matched with the order.

14. 3. The product is then placed in crates on a conveyor, which goes through the distribution centre
before being sorted by bar codes. 4.Crates arrive at the central point, and bar codes of products are
matched with orders and sorted automatically into one of several thousand chutes before going into a
box. 5. The bar code then identifies the customer order, boxes are packed taped and weighed, and they
are shipped by either US postal service or UPS for the last mile, arriving at the consumer within 1 to 7
days.

15. Amazon Supply Chain Strategies 1. The Use of Analytics of Buying History to Market to Individual
Customers. When you shop on Amazon, you don’t even have to surf their site because the company is
flashing similar products you have purchased and items that you have searched for in the past. There is
no Jedi mind trick here, they are simply using analytics of your past purchasing and browsing behavior to
sway your buying habits. 2. Brand Packaging We all know when we receive a brown box with a smile on
it that it comes from Amazon. Brand recognition is huge and putting your company logo on your boxes is
a great way to stay on your customers minds.

16. 3. Schedule a Free Tour of Your Facility. Any customer can request a tour of Amazon’s fulfillment
centers to see how efficient they are. If you want to develop a better relationship with your customers
and suppliers, invite them to your facility and show them how you do things. 4. Putting Cool Names To
Different Parts of Your Company to Drive Value . With trendy names like Pike Street, Pinzon,
Strathwood, Kindle, Dash, etc…Amazon has us chomping at the bit with what they are coming out with
next. Truth be and creating a PR campaign around them comes across as told, many of these brands are
simply Amazon private labeling different products. By associating slick brands to these services or
products new and fresh and makes customers feel they want in.
17. Advantages of Supply Chain Management 1.Supply Chain Management helps to increase savings in
labour . 2.Supply Chain Management helps to achieve better inventory control. 3. Supply Chain
Management is used to achieve higher revenues. 4. Supply Chain Management is used for production
tracking. 5.Chances of product failure rate can be reduced by Supply Chain Management. 6.Supply Chain
Management is used to provide better information on customer needs, tastes etc.,

18. Disadvantages of Supply Chain Management. 1.Sometimes Supply Chain Management can be very
expensive to implement. 2.Competitors can easily copy the strategy of Supply Chain Management. 3.For
better Supply Chain Management, proper skills and experience is required to achieve success.
4.Sometimes in Supply Chain Management various functions may be difficult to manage. 5.In Supply
Chain Management there may be staff resistance.

19. RECOMMENDATIONS The previous section has analyzed Amazon’s SCM in a detailed and
comprehensive manner. By focusing on the five themes in which the analysis proceeded, we were able
to identify the areas that Amazon does well in its SCM. However, there are components and aspects of
the SCM of Amazon where improvements can be made. This section identifies those areas and proposes
some recommendations that Amazon can follow and implement to make its SCM world class and be a
source of sustainable competitive advantage.

20. First, Amazon relies to a great extent on courier companies such as FedEx and UPS. In recent years,
Amazons’ brand image has taken a hit because of the unreliability of the last mile connectivity or the last
part of the SCM that is visible to the end consumer. In other words, while the other components of the
SCM seem to be efficient and complementing and supplementing each other, the part of the SCM where
the customer interacts has been found to be deficient. Therefore, Amazon can setup its own
transportation and actualize superior last mile delivery by creating its own fleet of delivery vehicles and
personnel. The second recommendation has to do with the aspect of “bullwhip”. This means that
Amazon can integrate its SCM better and move from a cooperation model with its suppliers to a
coordination mode. This would entail a sharing of information between all its partners and suppliers
using the latest technology.

21. Amazon And Alibaba Bet The Future On Supply Chain Management: eRetailers Invest Big In Logistics
The world’s largest retailers are planning to not only grow into the world’s biggest logistics companies,
but to completely revolutionize the industry. Both Amazon and Alibaba have recently made significant
investments to their supply chain capabilities and in the not distant future they will soon handle more
shipments than most specialist delivery postal and courier companies. In effect, these companies are
building their own streamlined delivery systems that may replace the more established specialists.

22. What Amazon is doing with its supply chain could devastate the competition ? The news started with
a report from Bloomberg Business that detailed a multiyear plan to have Amazon compete with UPS,
FedEx and — most interestingly — Alibaba. This includes leasing planes and registering an ocean freight
booking business. The plan, according to documents Bloomberg examined, is for "a global delivery
network that controls the flow of goods from factories in China and India to customer doorsteps in
Atlanta, New York and London. The project, called Dragon Boat, is proceeding."

23. The plan is massive in scope, entirely bypassing brokers that deal with cargo and global transit
paperwork. Amazon would then be "amassing inventory from thousands of merchants around the world
and then buying space on trucks, planes and ships at reduced rates. Merchants will be able to book
cargo space online or via mobile devices, creating what Amazon described as a "one click-ship for
seamless international trade and shipping."

24. Amazon Selects Infor for Global Logistics Business March 03, 2017 In a major coup for its GT Nexus
division, enterprise software giant Infor says it has inked a deal with Amazon that will see the
ecommerce giant running its transportation and logistics in part on the GT Nexus platform. Infor CEO
Charles Phillips revealed that Amazon has selected Infor GT Nexus to assist its growth as a logistics
business. Phillips commented “Amazon selected GT Nexus for transport management as they build out
their fulfilment business this is a strategic partnership since amazon will have a major influence on the
fulfilment and logistics of consumer and business products.”

25. What Is Amazon Doing With Infor? A report by Management study guide about Amazon’s supply
chain management packages delivered three recommendations in 2009 gave three recommendations to
Amazon. The first was to build out its own logistics company. It is doing this now. The second was to
integrate its supply chain information across its partners and suppliers. Selecting GT Nexus as its supply
chain and ecommerce platform is one way to do this. The third was to unify its IT systems for its supply
chain. It seems that it has selected Infor to help them do this .

26. The Role of GT Nexus: Infor GT Nexus is also critical to this new relationship with Amazon. It could be
the glue that holds Amazon, its partners and suppliers together in the future. The GT Nexus platform
would provide Amazon with a single network connecting its suppliers and partners across the globe. It
would give it visibility of its whole supply chain, identifying where goods are and allowing it to save on
inventory costs even further.

27. SOME FACTS ABOUT

28. .Two-Day Delivery Is So 2005. Amazon’s 2005 launch of Amazon Prime—an annual membership that
offers free two-day shipping on hundreds of thousands of items—was a game changer. It further
established Amazon’s online retail dominance. And, right as other online retailers began to catch up and
started offering free two-day shipping … Amazon took it a step further and began offering one-hour
deliveries with Amazon Prime Now. With a separate mobile app, customers can arrange to have
deliveries made during specific hours of the day. In select markets, customers can also order groceries
and even take out from local restaurants—making Amazon a direct competitor to delivery services such
as Favor and Instacart. Though the inventory for Prime Now is far more limited and is only available in
select cities, it has grown in size and availability since its debut in December 2014.

29. Game of Drones Amazon made waves back in 2013 when CEO Jeff Bezos announced that the
company is developing a drone-based delivery system, dubbed Amazon Prime Air. Customers with
eligible orders (packages must be under five pounds) who live within 10 miles of an Amazon fulfillment
center will be able to receive their packages via drones within 30 minutes or less.Though many
considered the 2013 announcement to be little more than a publicity stunt, there’s no question that
Amazon considers drone-based delivery to have great potential for its distribution system. Though
Prime Air is still in development and is currently facing some regulatory hurdles, it is expected to make
its public debut as early as 2017.

30. CONCLUSION
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www.slideshare.net/.../case-study-on- amazoncoms-supply-chain- management-practice.
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.http://www.slideshare.net/kurtu luserek/amazoncom-companies- and-facts

32. THANK YOU