Analyze Amazon and Walmart.Com Using the Value Chain and Competitive Forces Models
Analyze Amazon and Walmart.com using The Value Chain and Competitive forces Models
2.1 Amazon.com
2.1.1 Amazon’s Value Chain Analysis
2.1.1.1 Primary Activities
2.1.1.1.1 Inbound Logistics
Amazon has the advantage of avoiding the overhead and carrying large amounts of inventory because it orders the books from the distributors.
They provide money and contracts to prospective authors and decide how many copies of a book to print. Typically a first run printing for a book varies from 5, 000 to 50, 000 copies. However, best-selling authors’ first run printings are generally set at around 300, 000 copies.
Amazon.com receives products from its distributors, partners, manufacturers, and publishers. Receiving is typically at the pallet or case level. In some cases, Amazon.com receives mixed cases that include many SKUs. Product is received and routed for putaway to a location type based on its SKU activity profile. Items are received and routed directly to prime storage locations or sent to reserve storage. Item types are also taken into account at receiving. If an item is "sortable", it comes in a mixed case with other items and needs to be sorted into unique SKUs before putaway. "Full Case" items arrive as a case of homogeneous products and can be putaway as such. "Non-conveyable" products are too large or awkward to flow smoothly on automated conveyors and thus are routed to unique locations (Zeppieri, 2004).
Amazon.com distribution centers are segmented into reserve storage locations and forward pick storage locations. Amazon.com refers to forward pick storage as prime storage.
Pickers select product from prime storage locations to fulfill orders. Replenishments are performed from reserve storage to prime storage. Amongst the prime locations, there are library bins, case flow bins, and pallet bins. Library bins are similar to bookshelves and contain unique bins that each can store a small number of items. Case flow bins are locations where cases of
2.1 Amazon.com
2.1.1 Amazon’s Value Chain Analysis
2.1.1.1 Primary Activities
2.1.1.1.1 Inbound Logistics
Amazon has the advantage of avoiding the overhead and carrying large amounts of inventory because it orders the books from the distributors.
They provide money and contracts to prospective authors and decide how many copies of a book to print. Typically a first run printing for a book varies from 5, 000 to 50, 000 copies. However, best-selling authors’ first run printings are generally set at around 300, 000 copies.
Amazon.com receives products from its distributors, partners, manufacturers, and publishers. Receiving is typically at the pallet or case level. In some cases, Amazon.com receives mixed cases that include many SKUs. Product is received and routed for putaway to a location type based on its SKU activity profile. Items are received and routed directly to prime storage locations or sent to reserve storage. Item types are also taken into account at receiving. If an item is "sortable", it comes in a mixed case with other items and needs to be sorted into unique SKUs before putaway. "Full Case" items arrive as a case of homogeneous products and can be putaway as such. "Non-conveyable" products are too large or awkward to flow smoothly on automated conveyors and thus are routed to unique locations (Zeppieri, 2004).
Amazon.com distribution centers are segmented into reserve storage locations and forward pick storage locations. Amazon.com refers to forward pick storage as prime storage.
Pickers select product from prime storage locations to fulfill orders. Replenishments are performed from reserve storage to prime storage. Amongst the prime locations, there are library bins, case flow bins, and pallet bins. Library bins are similar to bookshelves and contain unique bins that each can store a small number of items. Case flow bins are locations where cases of