Amazon Supply Chain Management and Logistics Management

virago try Chain coun selling and Logistics forethoughtThe case study I have chosen for my topic is on AMAZON.COM, the ara w here I would be focusing is on the core judgmentl of e-business and the benefits it provide usefully in adopting e- put up chain strategies. The main focus here in on the joint e-as it has change the way of doing business in a global environment. Therefore, technology here plays a vital aim in expanding sensitive areas for businesses and enabling organizations to minimize their constitutes and work to a greater extent than precisely and effectively. Internet has made the land a sm completely crossroads for nodes as now customers from across the world crumb assess each product of their choice by superstar click of mouse. Internet is world of opportunities as I get into across a statement assumption by Tony Blair (UKs X Prime Minister),If you dont see the Internet as an opportunity, it go off be a threat. (Financial Times, 1999) (Barnes 2001 )Furthermore, this written report would be focusing on amazons annals and background, and then the focus would be on the product and service amazon is going to its customers, the practice of leave chain within the company and its customers. The paper as well as comprises of the benefits of e-business amazon is providing to the customers effectively as well as immenseness of logistics in fulfillment of come forth chain strategy throughout the supply chain.Background of amazon.Com amazon.Com was launched on 16th July 1995 by Jeff Bezos known as induct in e-commerce (R. Spector 2000) with a tag line under the alphabet A Earths Biggest Bookstore and is based in Seattle. At the beginning the web pageboy was designed for selling books with a message at the top of the website take in to Amazon.com Books Search one million titles. Enjoy consistently low prices. (R.Spector, 2000). At Present the company is providing three primary customer sets consumers, Sellers, and developers . The general inclination behind Amazon was to serve as many customers as thinkable with variety of products that the volume of business would generate profits for Amazon.com. (R.Saunders 2001). In the primeval phase of business the company agreed upon having a actually minuscule or no inventory due to greets involved in keeping inventory.In the early nineties many traditional bricks-and-mortar retailers worked with their suppliers in accordance with the concept exclusively-in- clip huckstery in dictateliness to keep the cost of inventory low but Amazon followed al closely-in-time cedey introduced by Barton Davis who was the sulphur employee of the firm when Amazon started. (R.Spector,2000). This strategy meant that the books will be delivered to the customers after they order it as they are non kept in the stock until a customer asks for it. At present Amazon have six warehouses where it stocks its inventory. As per the companys annual report of 2009 it indicates that company is experiencing continuous improvement in customer service which is result of 15 socio-economic classs of previous service deal speeding address, reducing their cost structure in order to cleft customers with ever lower cost prices. (J.P. Bezos 2010).Products and Services at AmazonAmazon started with selling of books by filling all orders of books by purchase from a distributor in accordance with the orders given by customers. At Amazon they have a stock of bestselling books. Amazons main strategy is to keep on expanding the set of products and sell them online. In June 2002 Amazon became an authorized dealer of Sony Corp., selling sony products online (E. Turban, 2006). Apart from books Amazon has added many new product categories such as music, toys, electronics, jewelry, shoes and apparel (S.Chopra 2007). According to the annual report of Amazon.Com (2009), it has added 21 new categories around the world which includes Automotive in Japan, Shoes and Apparel in China. Amazon web services as also launched new services and features which includes the Amazon Relational Database Service, Virtual Private Cloud, Elastic MapReduce, High-Memory EC2 Instances and Versioning for Amazon S3. (J.P. Bezos.2010). provide Chain Practices of Amazon.ComBefore we come to the supply chain practice of Amazon.Com its necessary to define Supply Chain Management, therefore supply chain wariness refersSupply chain counselling is a set of approaches utilized to efficiently integrate suppliers. Manufacturers, warehouses, and stores, so that merchandise is produced and distributed at the right quantities, to the right locations, and at the right time, in order to minimize systemwide costs while material service level requirement.. (D.S.Levi 2008, Pg.1).Now, after looking at the definition we come across the real mean of supply chain management, therefore, if we look at supply chain of Amazon.Com it start from the customer and annihilates up to the customer meaning i ts a continuous process which starts when the customer for the first time makes a request for any product at Amazon, it manoeuverly goes into his virtual field goal and after pressing the buy button and mode of payment he selects a mode of delivery services which includes overnight and various world(prenominal) fare options (R. Spector 2000). Amazon have a system where orders are recorded, registered and graceful and simultaneously, customer on the other hand is immediately apprised of the status of his order and how hanker will it take to ship the product with the amount of shipping costs involved in it (R. Saunders 2001).Inventory Management at Amazon.ComAmazon stocks best-selling books at its warehouses and get the other titles from other distributors or publishers. To deliver the products Amazon uses U.S. Postal Services, UPS and FedEx to deliver the goods to the customers (S.Chopra 2007). Here we gouge see the vastness of e-commerce in supply chain that how effectively organizations are assay to order and find new opportunities through e-commerce especially in field of supply chain management. The supply chain of Amazon is very strong just because of responding quickly and accordingly to the customers specification on delivering the goods at the right time, at the right place and at the right price during the time condition According to the annual report 2009 of Amazon.Com, the inventories rose over 200,000 titles at the determination of the year which enabled Amazon to improve the availability of products for their customers.Customer Relationship Management by Amazon.ComEvery business revolves around satisfying customers and enhancing their relationship for long term, the same implies with providing services on Internet or e-commerce, the general idea is to create a positive relationship with customers. The Internet has played an alpha billet in making it possible for organizations to focus on construct relationships with customers and havi ng a direct contact with each customer (S. Barnes 2001). Therefore, businesses on profit can improve synchronization, both within and across companies while providing a direct contact with end users. If we look at Amazon, it has build a strong relationship with all of its customers by encountering up their expectations and trying to be more effective in going beyond their expectations. From the companys more than 80 million customers across the world, more than half are borrow buyers (R.Saunders 2001).The focus of Amazon was to offer customers compelling value from the beginning and to meet customers requirement 365 days a year. According to the annual report 2009 of Amazon.Com, Amazon has relied on Word of Mouth advertisement and to date it remains the near powerful tool in customer acquisition because repeat purchasing and word of mouth has made Amazon to be a market leader in online bookselling. Therefore, it is consequential for retailers to emphasize on satisfying customer s because this can enable them to move first time buyers to loyal customers. Bezos, the chairman of Amazon once said,A pool of evangelists will use the Internet as a megaphone to help attract new customers with word of mouth. (R.Saunders 2001, pg.102)Importance of Logistics in Supply Chain ManagementLogistics plays an authorised role in supply chain because it acts as a bridge or link amidst the entire processes of supply chain as it is the main source of delivering the products to the end consumers in a timely manner as and when required. There is a big challenge in logistics in managing the whole logistics system in order to meet the customer requirements, perhaps, exceeding customer expectations. In todays emulous world and speed of ordering via Internet intensify the need of effective logistics system in order to deploy appropriate levels of inventory, delivering the products within the promised time and also managing the returns if required.The role of Logistics in Supply ch ain implies in creating a place public utility and in managing the time effectively, as place utility is provided through moving the goods from the point of production to the point where demand exists, therefore adding a economic value to the goods. Time utility is of greater warmness as it is not necessary that the goods and services should only be forthcoming where customers need them but also that they are delivered when they actually demand them. These both activities are clearly seen in the case of Amazon.Com as both the services are effectively and efficiently performed by the organisation.Role of Logistics in Amazons Supply ChainThere has been a deep research done by different authors in order to find the secrets behind the success of a retail company, and that is offering the right products in the right location at the right time having the right packaging in the right sum at a reasonable price to the right customer (R. Saunders 2001, pg. 119). This is one of the most c ore elements of any organisation and seems to be the most important accusive in Amazons shipping as well because the strategy is to deliver the product safely to the customer at the time specified. In the year 2000, Amazon developed a Delight-o-meter in order to track the entireness way out of items ordered worldwide. Amazon got high marks in price of delivering the products in time on holidays from all e-business and e-commerce magazines than other e-tailors companies of the world (R. Saunders 2001).Benefits of e-business in Supply ChainThe success of any retail and e-retail depends on providing note products at good prices having in mind quality excellent services. single of the most important benefit that e-business is providing organizations is to reach hundreds of millions of people open 365/24/7 in just a click of mouse omitting all the barriers which used to exists before. Companies with just a minimal capital requirement can considerably and quickly reach to the best suppliers, unlimited customers and even most suitable business partners across the globe. This activity enables organizations to buy at cheaper rank and sell more in number of quantity.E-commerce plays a vital role in overcoming the inefficiencies in supply chain such as delivery delays and excessive inventories can be minimized. Furthermore EB also benefits in cost reduction like decreasing the cost of processing, distributing and storage activities (E. Turban 2006). Companies are now investing heavily in order to get the word E. Customers are getting the benefit due to intensive competition and number of products available to them online, like with just a click of mouse a customer with saving a lot of time can easily gather information of the features and prices of a product and can easily tack together direct shopping sitting at home (S. Korper 2001). Amazon is a classical example of B2C, which means it remains between the seller and the buyer. The objective of B2C is to optimi ze the business relationships with customers, increasing service levels effectively and efficiently and at last increasing the sales (E. Turban 2006).ConclusionTo sum up I would like to say that e-commerce and e-business play is a life blood of organizations, especially when I talk about Amazon.Com. A comprehensive research has been carried out through my research that how Amazon.Com has evolved its virtual door opened on the globe Wide Web in July 1995. Furthermore, I would like to state that e-business plays an important role in managing the supply chain of Amazon.Com effectively and efficiently by offering customers what they are looking for and providing them their products within the time specified. Amazon.Com has become very successful in reducing its costs as well as increasing profitability effectively. The Amazon.Com leaves an example on how to do effective trade on the Internet and satisfying customers.The role of e-business in expansion of businesses also play an impor tant role as we see now every organisation whether big or small goes on the Web and offer their products or services on the web as well in order to grab millions of customer on the internet. E-commerce plays an important role in minimizing the costs throughout the supply chain and improves the level of service by meeting or exceeding customers expectations. At last but not the least, EC enables companies build a positive relationship with customers by providing direct services to the customers which in turn promotes better customer relationship management and increases customer loyalty.