Amazon Operations Management Essay

1090 Words 5 Pages
In 1995, Amazon started out as simply an online store to purchase books. Today, Inc. has turned into the leading e-commerce site selling a wide variety of products. Amazon has been successful in effectively using many components of the operations’ management criteria, making it the industry leader in both retail and the e-commerce market. The seller and distributor partnership is an advantage to all parties involved. Online retail services are its main organizational output. Value proposition: large selection, low prices, fast delivery, and convenience.
Forecasting for future demands is a challenge for every company to master. Amazon offers a variety of products which is necessary to stay on top of the demands of always changing fashion trends. The regular household items that are ordered are often easier to predict, and, as a result, helps in managing future demands. Amazon has the competitive advantage and continues to stay on top of its competitors by being one of the world’s largest online retailers.
Predictive Analytics and Computer Algorithms are used, resulting in Amazon knowing the shoppers’ wants before the shopper may even know themselves. Personalized recommendation systems predict what consumers want based off items previously purchased, what’s in their online shopping cart or on a wish list, and what items
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With the large demand for many items, inventory capacity is a strategic process. Different products are kept at different warehouses. Outsourcing is used for inventory that is not purchased or ordered frequently. Third- party sellers who sell products on Amazon also send their merchandise to the fulfillment centers. In warehouses there is a location for just-in-time inventory. That inventory may come straight off the truck directly to the packaging area to be shipped to fulfill a customer’s order. Warehouses also have a designated area for finished goods

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