supply chain management of amazon india
TRANSCRIPT
SUPPLY CHAIN MANAGEMENT OF
AMAZON INDIA
Presentation By: Abhisek Khatua
Introduction
• Amazon Incorporated as “Cadabra”, By Jeff Bezos.July 5, 1994
• Website went Online as Amazon.com; Online Book Store1995
• Acquired Junglee.com1998
• Entered Indian E-commerce space as Junglee.com2012
• Amazon.in launched2013
@Data Source: Amazon Corporate Website
Total E-Commerce Size ($ Billion)
Online Shoppers of Total
Internet Users (as a %)
Average Spending per Online Shopper in India
Investment Over $5 Billion
India: The Big Opportunity for Amazon
@Data Source: “e-Commerce in India: A Game Changer for the Economy”, CII, April 2016
Amazon Invades India
o B2C e-Commerce Market place; 2nd largest Online Retailer in India.
o 55 million products across hundreds of categories.
o 1.3 Million Products in Fulfillment Center (26 FC in 10 States).
• Massive Selection
• Low Prices
• Fast & Reliable Delivery
• Trusted & Convenient Experience
• Convenient Payment (Cash,
Electronic)
Customers Sellers
• World Class e-commerce platform
• Large Base of Customers
• Fast & Stress free shipping
• No Fixed Cost
• Secure & Timely Payment
• Professional Services
Amazon India: Products, Services and Value Chain
Kindle e-Readers & eBooks
Computers & Accessories
Sports, Fitness & Outdoors
Handbags & Luggage
Amazon Apps
Cameras, Audio & Video
Beauty, Health & Gourmet
Books
Shoes
Clothing & Accessories
Movies, Music & Video Games
Home, Kitchen & Pets
Jewellery, Watches & Eyewear
Car, Motorbike & Industrial
Mobiles & Tablets
Toys & Baby Products
Sell on Amazon
Fulfilment by Amazon
Pay with Amazon (Easy Ship)
Sponsored Product
Amazon Global Selling
Products
Services
Value Chain
@Data Source: Amazon India Corporate Website, Store Directory
Unveiling Supply Chain of Amazon India
With respect to their different services
Selling on Amazon (Sell Smart. Sell on Amazon.)
Set up Store on Amazon
Receive orders from Customers
Amazon delivers Orders
Receive payment from Amazon
Help to Grow Business Expand Globally
Amazon Easy Ship
Fulfillment By Amazon
@Data Source: Amazon India Corporate Website
How Amazon help to grow Sellers’ business?
Set up your store
Sit back and relax
Hassle-free Payments
Sell Globally
Crores of customers across the world
Fast and Stress free Shipping
No fixed costs. Pay when you sell.
Secure and Timely Payments
Professional services
Advantages
Fulfillment By Amazon (FBA)
1. Sellers send products
to an Amazon
fulfillment center or
schedule a pickup
2. Amazon stores
Sellers’ products –
from a single unit to
your entire inventory
3. Customers order
Sellers’ products from
Amazon, often with
fast, free delivery
4. Amazon packs and
ships Seller’s products
from fulfillment center to
the customer
5. Amazon’s customer
service and delivery
creates loyal, happy
customers
@Data Source: Amazon India Corporate Website
Fulfillment By Amazon (FBA)
Seller
Customer
INFORMATION
INFORMATION PRODUCT
PRODUCT
FC
Advantages of FBA- “You sell it, we ship it.”
Focus on your business
Build Trust
Pay as you go
Customers keep coming back for more
Cash on delivery payments
Amazon Prime
Amazon Easy Ship
1. Customer orders
from Sellers using Pay
with Amazon. Sellers
get a notification of the
order via email, Seller
Central.
2. Sellers schedule the
pickup and keep the
product packaged and
ready.
3. Amazon Easy Ship
delivery associate
picks up the package
from Sellers’ doorstep.
4. Amazon Easy Ship
delivers the package to
the customer and picks
up Cash on Delivery
(COD) payments.
@Data Source: Amazon India Corporate Website
Amazon Easy Ship
Seller
Customer
INFORMATION
INFORMATION PRODUCT
PRODUCT
Amazon Global Selling
Expand business to the US and other International Market
Showcase products to millions of customers
Increase sales by tapping intothe US & International holiday season
Selling on Amazon & Fulfillment by Amazon
Customers order Seller’s products on Amazon.com
Sellers can either choose to fulfil those orders on their
own or use Fulfilment by Amazon (FBA).
Fulfil orders on their own: sellers will fulfil orders
from India when a customer buys sellers’ products on
Amazon.com
FBA: sellers store their products in Amazon's
fulfilment centres, and Amazon will pick, pack, ship,
and provide customer service for these products.
@Data Source: Amazon India Corporate Website
Amazon Seller Flex
Warehouse
Customer
INFORMATION
PRODUCT
PRODUCT
Supplier
INFORMATION
Strategic Partners of Amazon
Amazon will use P&G’s warehouses for faster and economical product
distribution.
Amazon will use Future Group’s strong product knowledge, extensive
brand portfolio and sourcing base.
Amazon will use SBI’s smooth & trusted payment solutions for small
businesses and end customers
Fulfillment Centers of Amazon
Fulfillment Center: 21
New Fulfillment Center: 5
Delivery Station: 4
Largest FC in Sonipat, Haryana
Space: 200000 Sq. Ft.
Capacity: 800000 Cu. Ft.
Year end 2016: Combined Storage Capacity 7.5
Million Cu. Ft.
86% Sellers of FBA
1.3 Million Products are available for
Immediate Shipping
@Data Source: MWPVL International
FC, New FC and Delivery Station of Amazon
@Data Source: MWPVL International
Evaluation of Amazon India’s Supply Chain
• Delivers some of the products itself, while delivering some products sold by supplierson its marketplace using other logistics firms.
Hybrid Logistics Model
• “Innovating to get customers what they want, when they want it.”
• Using machine learning, data analytics, and complex simulations.
Amazon SCOT (Supply Chain Optimization Technology)
• Seller is free to choose self-fulfilment or marketplace-fulfilment.
• Infused inventory-led in a marketplace by having operational control over sellerentities like Cloudtail (Amazon).
Managed Marketplace Model
The Game Plan of Amazon India: Wining India
• 65 % Orders (2015) are from Tier II & III
cities
• Engaged in Pilot Project of Rural Delivery
Network in Tier III & IV cities with Connect
India E-Commerce Pvt. Ltd. (of Basix
Group)
Amazon India: Wining India
• Three-wheeled mobile carts to navigate in a city’s business districts, serve tea, water,and lemon juice to small business owners and teach them about selling online.
• Team travelled 15,280 km across 31 cities, served 37,200 cups of tea, engaged withover 10,000 sellers (in 4 Months)
Amazon Chai Cart
• A studio-on-wheels offering a suite of launch services.
• Enables small businesses to get online in less than 60 minutes.
Amazon Tatkal
• Deliver products in over 19,000 pin codes using Amazon Transportation Services,Blue Dart, and India Post.
• Most penetrated e-commerce platform in the country.
Easy Ship
Our Suggestion
• Customer Consideration, Vendor Consideration, Geo-Political Consideration,Logistics Consideration.
Multiple Hub & Spoke Model
• Better control, Business Diversification.
• Improved Delivery, Cost and Services.
A fully grown in-house logistic arm
• Tie up with Home-Grown Logistics Firm & Start-Ups.
More Investment in Supply Chain to penetrate Rural India
Conclusion
“Be afraid of Our Customers, because those are the folks who have the money. Our Competitors
are never going to send us money” …… Jeff Bezos
Supply Chain of Amazon India
Ready with
EVERYTHING
EVERYWHERE
EVERYTIME
Thank You