Analysis Of The Amazon Value Chain

1701 Words 7 Pages
Needless to say that value appears to be one of the most important components of every business. The quality of products predetermines its popularity among the customers, so every company tries to add value to its goods and increase the profit. The term of "value chain" is commonly defined as a set of activities, which are aimed to create and build value for a specific type of product (Gale, 2016). This process helps an enterprise to separate beneficial activities, which help a company to increase its profit, from useless, which hinder an organization from further development. Factories create value by purchasing qualitative raw materials and using them for production of certain types of goods. Retailers try to select the products, which meet …show more content…
The term of "value chain" was coined by Michael Porter in his book Competitive Advantage published in 1985. In this influential work, the scientists offered a scheme of general purpose value chain, which could be used by different organizations to add value to their products. The researcher stated that value chain has a tremendous influence on the company 's position on the market and its profits. In such a way, Porter has selected activities, which would help enterprises to bring more money into their institutions. The scientists divided all organizational processes into primary and support activities. Primary activities are those, which appear to be essential during production and shipping stages, such as inbound and outbound logistics, operations, marketing and customer service. All these activities have a tremendous impact on the product value, so companies should pay a big attention to them. On the contrary, support activities are those, which aim to support primary processes and help them to add value to products. They are also important as they ensure that primary activities would be organized on a high level. According to Porter, support activities include procurement, human resource management, technical development and infrastructure. All these processes aim to build a good reputation for an organization and increase its …show more content… appears to be one of the largest retailers, which offers various goods and products through its website. The organization was established in 1996, which started as a small bookstore. In several years, the company has expanded its product range to DVDs, Blu-rays, CDs, audio books, software, electronics etc. The organization has been operating successfully on different markets, including North America, Central Europe and Asia. Amazon Inc. creates its value with the help of the following activities: inbound and outbound logistics, operations, service and marketing (Tudon,

Related Documents