Amazon Case Study Total Score: 50

Deadline Thursday, 14 03:00 PM

Problem 1: Retrieving

(I). Amazon follows the JIT inventory system as it ships inventory daily from its warehouse to its dark stores. It
is important to ship SKUs in small quantities which often can be a single unit of a pencil. While Amazon holds
an SKU count of over 7,000 SKUs, daily orders usually range from 1,000 to 1,500 SKUs. Due to a time bound
operation, retrievers often resort to skipping SKUs and reporting the same in the app.

The major reasons for skipping the items can be

(i). Items not available physically

(ii). Items are not placed in the right place

(iii). Deliberate skipping of items due to time and effort.

How could we go about solving each of these problems?

(II). We have five dark stores which are fulfilled by our central warehouse. As the number of warehouses
increases the workload of the team would also increase. What can be some of the methods to retrieve the
items for all the warehouses in the lowest possible time. You can mention your assumptions and attach any
analysis.

What could be the possible reasons for skipping SKUs and how would you go about solving this problem. Do
you think skipping SKUs is a major hurdle for Amazon’s business?

Problem 2: Sorting

Once the order for dark stores is retrieved it is sorted for each dark store separately. Lately, we have been
getting complaints of extra/unrequired items being shipped to dark stores.

Our reports show that each dark store receives 10% extra value of inventory of their daily order. What could
be the possible reason for extra inventory being received at dark stores specially when retrievers skip almost
10% of their daily ordered SKUs.

How would you go about addressing this problem and ensuring that only accurate inventory is transferred to
the dark stores?

(i). What could be the possible reasons for this mix up?

(ii). How can the efficiency of sorting activity be increased by 50%?

(iii). What should be the optimum process flow for sorting activity to ensure 100% order accuracy?

Problem 3: Loading

Amazon transports 1000+ SKUs to its dark stores daily. A significant number of SKUs are fragile or consist of
edibles which get damaged during transport from Warehouse to dark stores. Damaged goods directly impact
customer experience and are disposed-of at the sight of slightest bit of damage.

(i). What could be the reasons leading to damaged inventory during transport. Is it even damaged during
transport? Do you think disposing-off meagrely damaged food items is the way to go if Amazon wants to
become a successful business?

(ii). What should be the loading mechanism/process flow for the products?

(iii). How can the efficiency of the loading process be improved?