Hệ thống hậu cần và chuối cung ứng của amazon và những bài học e

"THE SYSTEM OF LOGISTICS AND SUPPLY CHAIN OF AMAZON AND THE LESSONS" I INTRODUCTION OF ENTERPRISE Amazon.com Inc is a U.S company of electronic commerce located in Seattle, Washington Amazon is a company operating in many industries, such as books, music trading services, computer software, furniture, game P.Bezos Jeffrey is founder of Amazon in 1994 and began to trade online in 1995 Initially, the company is just an online book store, then a store with more various products such as DVD, CD, MP3, computer software, games, electronic device, food, game, furniture, jewellery, and clothing Amazon designed many websites in Canada, England, Germany, France, China and Japan It also exported some goods to other countries Amazon opened retail branches for CDs, videos and DVDs, software, consumer electronics, kitchenware, tools, lawn equipment, gardening equipment, toys, games, baby dresses, clothing , sporting goods, food, jewelry, watches, personal care equipment and health care devide, beauty products, musical instruments, clothing, vegetables, raw materials for industry and science The company operated A.com auction, auction service on March 1999 However, it failed to limit the strong development of the pioneer in the industry: eBay Then, the business of fixed price market called zShop was conducted on Setp 1999 and venture of Sotheby's / Amazon called Sotheby.amazon.com in November Amazon no longer mentions auctions or zshop in the main webpage and webpage for supporting sellers now mentions only Marketplace Old link to zshop is now directly linked to the home page and the old link to auctions takes users to a page on the history of transactions List of new products is now no longer available for these services Although zshop did not last long as expected but it is still setting the foundation for the success of Amazon market services launched in 2001, for customers to sell used books, CDs, DVDs, other products as well as new products Now, the main rival of Amazon Marketplace is eBay's service of Haff.com Early August 2005, Amazon began to sell products under a private label, "Pinzon" Initial brand applications suggested the idea to focus on textiles, kitchen utensils and other household keys In March 2007, the company expanded the brand to cover and diverse goods To register for a new design with stylized PINZON and the letter O at place of one hour on clock List of registered products under the developed brand includes paint, carpet, wallpaper, hair salon, cloth, footwear, beauty instruments, and jewellery On May 16th 2007, Amazon announced the plan to open an online music store The store started to operate in the U.S on Sept 25 th 2007, trading MP3 music downloads without digital rights management (DRM) This is noteworthy because it is the first online sale service, DRM free music from four recording companies On August 2007, Amazon announced Amazon Fresh-food – a service of sale of fresh foods and food ready to eat Orders can be delivered or sent to customers in the morning In 2008 Amazon expanded to the field of film production and has recently invested in "The Stolen Child" in collaboration with 20th Century Fox Website The domain name of Amazon.com attracts at least 615 million visitors every year according to research of Compete.com This figure is at twice of that of Walmart.com Currently, Amazon earns hundreds of millions in profit every quarter II BUSINESS STRATEGY OF AMAZON Amazon's business strategy: Amazon has developed a global business strategy through online sales and the first online product is book Over years, products are not only books but also other products, services and strategic partners Business line Amazon trades products such as Video tapes and DVDs, software, consumer electronics, kitchenware, tools, lawn equipment, gardening equipment, toys, games, baby dresses, clothing , sporting goods, food, jewellery, watches, personal care equipment and health care device, beauty products, musical instruments, clothing, vegetables, raw materials for industry and science These are common products that Amazon has chosen to sell online easily and have been chosen by customers Market segments Amazon offers products to every customer To create business advantage, Amazon focuses on customers in need of online purchase This is a very useful service which is widely used and will be the consumption trend in the future Competition priority strategy Amazon focuses on competition priority strategy with following rivals: Cost: Time: - Low cost - Quick delivery - Easy and - Transactions processed convenient assess immediately by the system Competitive advantage Quality: - High quality - Good customer Flexibility: - Many products and services - Trading at anytime, anywhere service 4.1 Focus strategy 4.1.1 Focus on providing essential goods for daily consumption Previously, the items that Amazon offers are mainly products such as music players, books, electronics, today, the shopping needs of customers are more diverse, so Amazon have focused on various commodities meeting the daily needs of people Amazon aims to provide most of products needed by customers, e.g lifting logo with ambition to offer all products in the alphabet After the first year with unexpected success, Amazon has extended trading including the sale of food, fashion, jewellery And people say that coming to the Amazon, you will have everything you need People are increasingly under pressure, and have less time to go shopping On the other hand, new purchasing technology makes them more interested in new consumption style Therefore, moving to focus on sale of essential consumer goods is a smart strategy of the Amazon 4.1.2 Focus on direct retail Amazon and eBay are two "big ones" in the retail market Amazon has an opinion of slow but sure retail Previously, the two companies have two different directions, so often their statements complement each other rather than compete directly with each other eBay focuses on auctions with thousands of consumers’ shops, but Amazon focuses on direct retail However now, eBay is moving to fixed-price sales, and Amazon encourages consumers to open retail stores on Amazon, so eventually, two companies approach to each other in Jeff Bezos development strategy, during be interviewed by the New York Times, they said that they are willing to sow and wait for picking fruit in seven years While eBay has extended to classified advertising, online payments and Internet telephony, Amazon spent hundreds of millions of dollars on developing reliable retail brand- such as willing to pay customers in case of problems with trading 4.2 Differentiation Strategy 4.2.1 Policy of providing high-quality products Customers are increasingly more difficult about product quality and meeting needs They pay less attention to price (but at a price that is acceptable) and mainly focus on quality Foreseeing this trend, Amazon has focused on providing the best quality goods to meet demand, committed to provide our customers with high quality products as presented on the website Amazon is taking advantage of available database of transaction for online sales in accordance with the taste of every person Those who used to buy products at Amazon know that then, the company often sent mails to offer similar products or ones researched on Amazon It often got comments from customers about purchased goods This confirms customer's confidence in Amazon’s product Amazon eventually drew loyal customers of eBay (rival of Amazon) Besides, Amazon has won advantages on aspects that were previously seen as advantages of eBay 4.2.2 Quick delivery of products The application of electronic commerce brand has made the transaction on Amazon quick and convenient Bezos argued that e-commerce is a vital element of Amazon As the first company to proceed the online retail sale, Amazon has taken its advantages through the application of information technology in managing warehouse and distribution network widely to ensure that products are delivered to customers as quickly as possible Time of supplying Amazon’s products has been reduced from or days to or days As a result, their profits have increased III ANALYSIS OF LOGISTICS AND SUPPLY CHAIN SYSTEM OF AMAZON Logistics strategy and supply chain There are many definitions of supply chain management, but firstly, we discuss the supply chain What is supply chain? The supply chain includes all businesses, directly or indirectly, involved in meeting customer’s needs The supply chain includes not only manufacturers and suppliers, but also transportation companies, warehouses, retailers and customers These companies act as people making order 3.1 Warehouse system: Logistics is one of six critical functions in operation of a business It ensures that the production system of the enterprise can operate normally It is also a competitive advantage of businesses when it wants to meet customers’ needs best When mentioning the warehouse system, people often think about traditional business But Amazon has created a difference by building a perfect warehouse system for a business using e-commerce methods The decision of Amazon on building its own storage systems is a difficult decision With a value of about US $ 50 million for every warehouse, construction and operation of the warehouse system is very costly In order to be successful in business, Amazon has to issue $2 billion of corporate bonds Superficially, it seems that Bezos is not building up a real dot.com Company because the Company have tangible warehouse system as conventional retailers Many investors began criticizing Amazon's business model that it is not different from the traditional retail companies, just having a more impressive website However, if someone comes to visit Amazon's six warehouses today, one can easily recognize that the investors were wrong to criticize this model of Bezos The Amazon warehouse is unlike the traditional warehouses that it is highly computerized Amazon's warehouses are using technology so high that they require a lot of code lines to operate and no less complicated than website of Amazon Computer starts the process by sending signals through the wireless network to the workers so that they know what needs to get down from the shelves; then they pack everything in order to send During shipment, the computer generates numerous data lines from the wrong-packed products to the waiting time and the managers shall have a duty to closely monitor this data system Bezos often visits a warehouse for a week in the last quarter of a year For employees, this time is so hard when the boss visits them Bezos sets out a series of questions about the algorithms system for order processing, productivity processing speed, and never satisfied until a satisfactory answer In response, the managers of the Amazon in the storage unit must make every effort to push yields up to a maximum For example, with a redesign of the transfer system on automatic conveyor, Amazon was able to increase the productivity of a stock by 40% In three years, the costs for operating Amazon's warehouses fell from 20% of sales to less than 10% of sales Even the company executives could not believe in this achievement Amazon's warehouses operate so effective that the rotation rate of the new warehouse is reached 20 times / year All other retail companies reached just under 15 times / year In fact, one of the biggest strengths of the Amazon is the capability to manage inventory, and even Amazon are assigned by other retail companies over all business operations of its e-commerce for Amazon subcontractors, as in the case of retailers Toys Rus and Target All of the above explains an important opinion that Bezos has patiently pursued since he started Amazon and being begun by people that: "In the visible world, everybody thinks that the location is the most important For us, three things are the most important: technology, technology, and technology” Amazon has spent a lot of money on developing computer software By switching to use Linux free operating system, its costs down to 20% for technology Amazon also passed over other traditional retailers by expanding cooperation with competitors Amazon is now selling many products of the other retailers on its Website the same It sounds like that Amazon is "suicide", and at first Bezos opposed the idea But after making that idea, the success of the Amazon was beyond the expectation The reason that Amazon could this is because the Company owns a very effective storage system Amazon's profit margin for wholesale and on commission for the competitors is equally high to the profit margin if the Company directly sell to the consumers 2.2 Supply speed Amazon pays great attention to improving customer care activities Amazon's delivery time was reduced from 5-6 days to 1-2 days This helped overcome Amazon’s rival as eBay In quarter 4/2008, Amazon's profit has increased one third compared to eBay Initially, the supply is very small and concentrated at some points until the volume of orders increased and Bezos decided to open additional delivery points in order to best meet the customer needs Also Amazon used U.S post offices and other vendors such as USP and Fedex to send products to the customers 2.3 Network Amazon customers are spread everywhere in the world So the company requires having a large network so that it can meet the customer’s requirements By applying modern technologies in managing business operations, from the collection of customer demand, orders, information processing to transferring the products to the buyers, Amazon does it professionally, with good service quality, meet the customer requirements Amazon often directly order from the manufacturer, the products that Amazon sells are stored in Amazon warehouse in capacity of order expectation of the customer In 2008, Amazon has warehouses in U.S and 15 other warehouses in the rest of the world 10 Model of supply chain of Amazon Amazon.com Manufacturer Customer Warehouse of Amazon Carrier Why does Amazon choose the above logistics system and supply chain? Building up the above logistics system and supply chain can help Amazon: Firstly, It helps Amazon to reduce storage investment costs, office construction costs and reduce the number of employees who work directly Secondly: It helps Amazon to accurately forecast customer the demands, diversify products, improve their competitiveness with rivals Thirdly: It helps Amazon in risk management, enhance the use of capital, ordinarily the customer must pay before receiving the goods Thirdly: It helps Amazon to extend customers around the world, not limited by geography, language resources, as well as shopping time Sentence II Which lesson is drawn up from the logistics system and supply chain of Amazon 11 Through the understanding and analysis of logistics systems and supply chain of Amazon, we can draw up some lessons as follows: + The building-up of the logistics system and supply chain is a very important operation, it decided the success in business of the enterprise The buildingup of the logistics system and supply chain reasonably could help the enterprise expand products and services, enhance business capacity and through it to help the enterprise survive in a recession, even when the traditional business products saturated + The building-up of the logistics system and supply chain reasonably could help the enterprise reduce unnecessary costs such as investment costs, inventory costs, transportation costs, service time, etc., Thus, the enterprise can compete with rivals in the market, through that the enterprise could dominate the market, improve business efficiency, increase profits for the enterprise + In order to build the effective logistics system and supply chain, it requires the enterprise (manufacturers, carriers, distributors, etc.), the parts in the chain should improve the competitiveness and working closely together for the common purposes References - PhD Nguyen Thanh Hieu – Operations management curriculum – PGSM - Amazon.com - Source: Collected and summarized from posts on Internet 12 ... this achievement Amazon' s warehouses operate so effective that the rotation rate of the new warehouse is reached 20 times / year All other retail companies reached just under 15 times / year In... sales, and Amazon encourages consumers to open retail stores on Amazon, so eventually, two companies approach to each other in Jeff Bezos development strategy, during be interviewed by the New... competitive advantage of businesses when it wants to meet customers’ needs best When mentioning the warehouse system, people often think about traditional business But Amazon has created a difference