Analysis of Supply

Chain Network of
Amazon Inc.
What is Amazon
Supply Chain

• Amazon’s Mission: To be Earth’s most

consumer centric company
• One of world’s largest supply chain with state-
of-the-art operations
• Coupled with automation and Technological
advancements
• Combination of warehousing, inventory
management, pricing and delivery time
• Goal: Maximizing the level of responsiveness
while minimizing the shipping cost
 Their 2 main
Principles
• Amazon works on two main
strategy to move the
products listed on website or
offline stores,
• Fulfilment by Amazon
(FBA)
• Fulfilment by Merchant
(FBM)
G L O B A L S U P P LY
CHAIN OF AMAZON

• Amazon operates in 11 online marketplace

worldwide.

• Amazon dominates in North America, Europe

and Asia.

• When you register to sell in one of these Amazon

marketplaces, sellers gain immediate access to
customers who know and trust the Amazon
buying experience

• Amazon gives recognition to the sellers without

having any presence in other continents.
Logistics of Amazon

Logistics in Amazon includes everything from

fulfilment centers , warehouses , distribution
centers , sortation centers , whole foods retail ,
transit hubs , 3rd party logistics operators (such
as fedex etc) and in house logistics such as fleet
of prime vans , drones and many more.
 Warehouses of
Amazon
• Warehouses are generally distributed
around their regions of operation.
• They are usually situated just outside
city limits due to space constraints
• Amazon invests heavily in inventory
& warehouse management
• Automation is an area of key focus for
Amazon warehouses- robots facilitated
by the acquisition of Kiva Systems in
2012.
 Transportation -Delivery Options provided by
Amazon
• Amazon currently depends mostly on 3PL operators and subcontracts most of their delivery related operations out.
• They aim to provide at least 50% of the deliveries themselves in the coming years.
• They have invested in over 30000 trucks worldwide to improve their same day delivery capabilities. These trucks are
usually placed near distribution centers.
• Their approach of reducing dependence on 3PL is against common wisdom but their aim is to improve their same
day delivery capability.
• They are trying to create an integrated business model where all aspects are handled internally, thereby reducing
overall costs.
• They are also improving their global delivery capabilities by acquiring 66 cargo airliners (Amazon Air)
• They are also experimenting and increasing investment in drone delivery capabilities in urban areas. Reducing the
costs of labour associated with delivery, thereby reducing costs for customers.
How the
supply chain
works