Amazon strategies to manage its inventory

Amazon strategies to manage its inventory Amazon .com called itself Earths Biggest Bookstore because it has been ranked as the best consumer e-business. It sells books, music over the internet. From both market and supply chain management point of views, Amazon has some challenges and strengths. Managing inventory is one of the company opportunities to overcome its financial barriers regarding the warehouses and shipping costs. Amazon follows some strategies to manage its inventories. It had the decision to outsource its inventory to reduce its inventory costs and to sell competitors products on its site to achieve both managing its customer relationship and sustaining its competitive advantage. As its competitors estimate that Amazon.Com has the highest percentage of the e-business bookstore. So, Amazon tries to share its information and outsources this area of its business to improve inventory cost and customer service levels. 1- Amazonstrategies to manage its inventory: Amazon found the decision of stocking the stores with all the possible products was not the right one. Although that the customer might choose not to purchase if there are not enough goods in the stock, It decided to manage its inventory in the season of 2000, following certain strategies. It started from reducing the warehouses, concentrating more on the quality of the products and the manufacturer or the publisher of the products. Then it had to decide the center of distribution it can send its products to and know how to receive and track the product once it was in the warehouse. Amazon also decided to buy its products directly from the manufacturer to sustain its vendors relationships to gain the best deal from them. Amazon.com developed a distribution infrastructure to provide its customers with the fast delivery from the company directly. Its distribution facilities have the great impact on increasing its products that are delivered and shipped very fast to the customers. The quick shipping process comes out of the great availability of the goods to achieve its customer satisfaction. This network distribution is called manufacturer storage with direct shipping which is one of the six distinct distribution network designs. It has advantages and disadvantages. Through this network, manufacturer storage with direct shipping can be appropriated for a large variety of low demand, high value items with several partial shipments. Drop-shipping model is also suitable if it allows the manufacturer to postpone customization, and there should be few sourcing locations per order. Drop shipping is not be suitable to be used if there are multiple locations that have to shipped directly to customers on a regu lar basis. Amazon can centralize inventories at the manufacture and then save inventory costs. Also, Drop shipping offers the manufacturer the opportunity to further lower inventories by postponing customization until after the customer order has been placed. However, when a customer orders several items from several manufacturers such as Ingram and Amazon, this include multiple shipments to the customer and thus increase costs. Also, this business model can has negative effect on Amazons competitive advantage by making no entry barriers for competitors because of its popularity and better margins (Chopra, 2001 ) . In terms of handling costs because the manufacturer has to deliver the order directly to the customer, Amazon developed its software to manage the split shipment if multiple items are ordered. So Amazon needs to share its information with the suppliers to provide the customers with the product availability and order processing to save time and reduce inventories. However, Cachon and Fisher point in their paper Supply Chain Inventory Management and the Value of Shared Information that information technology or software give the retailer the chance to share demand and inventory data faster and cheaper. They investigate how information sharing whether it is traditional information sharing or full information sharing between the retailer and the supplier affects supply chain inventory management regarding reducing lead times and increasing delivery frequency by reducing shipment batch sizes. The result of the study they have done is that the average of full shard information policy in supply chain costs is lower than of traditional information policy. But from Chopras and Meind perspective IT must be fully shared between all the stakeholders; suppliers and retailer. Amazon.com provides its customers with experience from beginning to end and own the whole data which gives them all the information they need about the product availability though the invent ory is located at the manufacturer. At the same time the buyers should have a clear idea about the order processing that is placed at the retailer. By owning such a system, Amazon could achieve high level of customers services because the information is directly linked to the customers in the system. As the company expands its operations, these systems are replicated across the distribution centers. Amazon.coms case is a good examples that illustrates how evolving industry standards can affect data-sharing strategies between customers and suppliers because it does not stock all the books advertised on its site, but shares customers order data with suppliers to speed customers orders.. This system solves the problem of inventory costs because Amazon. com spent US300m in 1999 to outfit the 3 million square feet of warehouse space. Finally Amazon does not need to stock every single item in the warehouse. Instead of that, the retailers or their vendors will send the products without eve r being stocked on the shelves of the warehouses. So, it started to develop its software to increase competitive pressures on all on line retailers in general and to rearrange its warehouses in different regions in particular. Amazons unique strategy is described as change and growing intense competition. Its systems and network infrastructure increase the traffic on its Web site and expanding sales volume through its transaction-processing systems. Amazons main concern regarding its network distribution and software is to avoid the unanticipated system disruptions, slower response times, weakens customer service and impaired quality and speed of order fulfillment, or the postpone in supporting the customer with the accurate financial information. 2) Outsourcing its inventory management: I think Amazon had taken the right decision to outsource its inventory management. In the case of Amazon did not outsourced all of its inventories but it keeps its popular ounces. This was a good decision for many reasons; the major ounces are to cut down its costs and give particular concern on it core activities. It partnered with other distributors for shipping the inventory like Ingram Micro and Cell Star. At the time the partners shipped the items, Amazon concentrated on its e-commerce expertise. Also, Amazon managed order fulfillment while Toys R Us managed the supply processes. Amazon outsourced much of its fulfillment. Although it acquired more than 4.5 million square feet of warehouse space worldwide by the end of 2000, it is using only 40 percent of its warehouse space. Through outsourcing; Amazon increases its efficiencies in distribution. From a another perspective there are Some risks of outsourcing because of the complexity, confusion or unclear decision making, and bro ken information flows in decentralizing, which can be corrected by redesigning processes and improving information technologies. Others thinks that small companies only can get benefit from outsourcing or third party because they need experience and supports in technology. However outsourcing leads large companies to have complex supply chains and many distribution managers (Razzaque and Cheng 1998). Amazon outsourcing inventory contributes to profits through providing its employees and users with the methods and strategies to maintain the firms competitive advantage, adding value to the goods, enriching customer service and assisting in opening new markets. One of the benefits of third party logistics is providing provide their customers experience that otherwise would be hard to acquire in-house. An company should consider certain criteria in outsourcing process such as quality, capacity, labor, scheduling and skill to be important in a make-or-buy decision (Razzaque and Cheng 1998). In Amazons case, it had an agreement with Ingram Micro Inc be cause it is one of the largest wholesale of electronic goods to provide logistics to services for computers at Amazon. com. Moreover, it has great experience in distributing process and customer satisfaction. 3- Selling others products on its website The idea of selling other competitors products on Amazons site is very profitable because the clients can be aware of the prices of others product compared with Amazon. This provides the company with more profits without making advertising to their low price products. It opens new stores on its site to give greater availability of the products and draw more customers. IT gives the customers the chance to turn to Amazon to buy more than books and music especially because Amazon handled the site orders, while the third party company handled the inventory. It may seem at first that a customer always wants the highest level of performance along all these dimensions. In practice, however, this is not always the case. Customers ordering a book at Amazon.com are willing to wait longer than those that drive to a nearby Borders store to get the same book. Customers have the advantages to find a variety of books at Amazon compared to the Borders store. On the other hand, firms that target cust omers who value short response times need to locate close to them. These firms must have many facilities, with each location having a low capacity. Thus, a decrease in the response time customers desire increases the number of facilities required in the network. For example, Borders provides its customers with books on the same day but requires about 400 stores to achieve this goal for most of the United States. Amazon, on the other hand, takes about a week to deliver a book to its customers, but only uses about 5 locations to store its books.

Second Continental Congress Essay -- Essays Papers

Second Continental Congress â€Å"Give me liberty or give me death† were the famous words spoken by Patrick Henry in the struggle for independence (Burnett 62). He addressed the first continental congress in 1774 and started the process of American political revolt. This revolt eventually climaxed in the rebelling of Britain's American colonies and the establishment of what would become the United States of America. The Second Continental Congress accomplished independence through organization, rebellion, and finally declaring independence. This was the beginning of the American Revolution. Britain established a series of acts to control the colonies and this became the main cause of the revolution. These acts enabled Britain to increase the colony's taxes and pay for the costs of the seven years war. In addition, Britain angered the colonies by maintaining a large army in North America after peace was restored in 1773. The British also enforced a Stamp Act, which placed taxes on commercial and legal products. To further add to the frustration, the British controlled the shipping of goods and re-routed shipments to avoid going through London middlemen, who sold to independent merchants in the colonies. The final cause of the American Revolution was the addition of the Coercive Acts, which closed the port of Boston and cut back the local elections and town meetings. Thomas Paine summarized the colony's emotions towards the British and published a pamphlet, â€Å"Common Sense.† In this pamphlet he mocks Great Britain, a small island thousands of miles a way, that controls a large country that should have independence. In September 1774, the first Continental Congress met in Philadelphia where they agreed upo... ...of Independence listed the tyrannical acts committed by George III, proclaiming the natural rights of man, and sovereignty of the American States. The Second Continental Congress was the backbone to the Revolution as well as being the key to freedom. It proved that, â€Å"All men are created equal† and possess the freedom of rights. Works Cited - Buckler, McKay H. The History of Western Society. Boston: Houghton Mifflin Company, 1995. - Burnett, Edmond C. The Continental Congress. New York: The Macmillan Company, 1941. - Fiske, John. The American Revolution. New York: Houghton Mifflin Company, 1891. - Schlesinger, Arthur M. The Colonial Merchants and the American Revolution. New York: Frederick Ungar Publishing Company, 1957. - Trevelyan, George O. The American Revolution. New York: Longmans, Green and Company, 1928.

National Health Service Reorganization

Any UK government is faced with a long list of health issues, this list would include macro questions such as the relationship of the National Health Service (NHS) to broader policies which might affect the health of the population and how to finance and staff health services. The NHS has gone through many stages of development in the last century, however the 1990 act introduced the most radical accounting control system since the birth of the NHS. Much accounting research has been developed on this topic and this paper will bring together some of their findings. By the late 1980†³s general management in the NHS was in full force, and expectations of ‘management discipline† were high, however there were a series of recurrent crisis. These crises were particularly evident in the hospital services and were caused by a combination of scarcity of compatible resources and an infinite demand for health care. Through a fundamental view of operations in 1989, two reviews were drawn up by the department of health, ‘working for patients† and ‘caring for people† (DoH, 1989a, 1989b), and these formed the basis of the NHS and Community Care Act 1990. The main focus of the impact was the concept of the internal market. This essentially involved the separation of two of the main functions of the NHS, purchasing and providing. Purchasing is defined as the buying of health services to satisfy local needs and providing, is defined as the day to day business of delivering that care. The purchasing agencies are provided with a budget which reflects their defined population, from which they must identify health needs, plan ways to satisfy them while ensuring the quality of the service. When the purchaser identifies their requirements, they produce a contract with the providers, who in turn invoice the purchaser for the materials and services provided. This illustrates the ‘Quasi-market† in operation, a Quasi-market being a market which seems to exist but doesn†t really. Flynn (1993) described the internal markets in the NHS as a mechanism to match supply with demand, and allow hospitals to compete on price and quality to attract patients. This new ideology of governance of the NHS has changed dramatically, especially through the Thatcher administration. Harrison (1997) describes how there are three ways of co-ordinating the activities of a multiplicity organisation, through markets, clans and hierarchies. Clans and hierarchies are based on using the process of co-operation to produce an ordered system of outcomes. The historic NHS was built very much around them; a combination of bureaucracy and professional culture; labelled as ‘professional bureaucracy† by Pugh and Hichson (1976). The new NHS is now reflected as having a market orientated organisation. The reformed NHS was established on 1st April 1991. On that day the internal market became operational, it†s main features were, that there is a fixed level of ‘demand† whose total is determined by NHS funding, trading takes place among a large number of buyers and sellers, and there is competition among suppliers. In this market it should be expected that managers respond with price, quality and branding as weapons of competitive behaviour (Flynn 1993). Llewellyn (1993) described the introduction of an ‘internal† or ‘Quasi-market† in health and social care, as a reaction to and was practically enabled, by an expanding population. Her research that looked at two factors, which forced reform in the NHS, demographic trends and technological advancement. The first factor focused on the growing problem facing nation states in the developed world is that of an ageing population and hence a greater dependence on the NHS in future years. Between 1961 and 1990 the percentage of the UK population over sixty five increased by one third and the numbers aged eighty five and over, more than doubled (Population Trends 1992). The second factor looked at the advancing technology of medical care across the developed world, which offered a new range of medical services and techniques. These advances however caused a problematic escalation in the supply and demand for medical treatment, and therefore total cost of that treatment to the purchaser. The basic rationale of her paper, was how the introduction of a market into health care causes an anticipated stimulus to competition and hence constant improvement in resource allocation and cost management. Hood (1994) identified two aims of the government in office as regard to the public sector, first the desire to lessen or eliminate differences between modes of private and public sector organisation. Secondly, the intention of exerting more control over the actions of public sector professionals. However, to discuss the first aim it is important to realise that there is a fundamental difference between developing a customer orientation in the private sector and a user orientation system in the public services (Flynn 1993). Private sector problems tend to be in efforts to market their products or services to the consumer, usually in competition with other firms. Whereas, public sector problems tend to be trying to deter too many people using their services, as opposed to attracting them. Therefore, this produces a fundamental problem in the trying to eliminate these aspects. Several issues caused the government desire not only to control, but also to make resource usage more efficient. Firstly the deepening public sector problems had to be addressed, and the adoption of more accountable systems seemed a perfect solution. There was also the desire not only to be able to control but also reduce public expenditure. Finally, political promises were made to reduce the share of public expenditure in National Income, to curtail the range of functions being performed by government, whilst also seeking to improve, nurture and stimulate the business attitudes and practices necessary to re-launch Britain as a successful capitalist economy, this was a conservative attitude. The government therefore promoted the view that accountable management reforms are needed for the public sector to be more accountable to those who receive, pay for or monitor public services; to provide services in a more effective, efficient and publicly responsible fashion (Humphrey 1991). The emergence of an internal market for health services inevitably resulted in the emergence of various accounting techniques, their purpose was to act as a stimulus to ensure efficient allocation of resources and to minimise costs. The increasing competition derived from this market created a need for management control systems. Hood (1994) categorised international accountable management as having up to seven dimensions, for government implementation of a system in the public sector. First, that it sought a greater disaggregation of public sector organisations, secondly, it would be searching for a stronger competitive use of private sector management techniques. Thirdly, a heavier emphasis on efficiency of resource usage, fourthly, reforms in accountability management. Fifthly a clearer specification of input/output relationships, sixthly, a greater use of measurable performance standards and targets, and finally, the use of ‘hands on† management of staff in control. These categories relate to Hood†s (1994) two aims, discussed previously, with the first three dimensions relating to his first aim of eliminating differences of public and private sector organisations. The four are geared towards the second aim of control. Hood†s research was based on a comparative study of cross-national experience of accountable management reforms. Arguably the views on the adoption of management control systems in the public sector depends on our position in society. As our society is more focused on markets, competitiveness and efficiency, it is likely that accounting techniques will play an important role, however, the importance of keeping the welfare of our society should be first and foremost. After all the goals of public sector organisations should differ from those in the private sector (e. g. they should not be profit maximisers). The objective of the NHS as an organisation remains unchanged since the reforms, in terms of securing an improvement in the state of the health of the population. However, it is now faced with the dilemma, that the means of achieving this greater improvement has been surfaced with financial considerations (Mellett 1998). One of the consequences of the reforms carried out on the NHS, after the NHS and Community Care Act 1990, is that at the level of health care delivery, it has been fragmented into over 500 separate trusts. Each of these trusts is a clearly defined autonomous unit which has an obligation to monitor performance in terms of both finance and patient care activity (Clatworthy et al 1997). This was the governments preferred mode of organisation and it becomes universal along with the associated accounting regime (Mellet 1998). Mellett (1998), looked at how the revised accounting system operated within trusts, and found that their procedures included a system of capital accounting; it†s objective was to increase the awareness of health service managers of the cost of capital and the incentive to use that capital efficiently. However, introducing a new control system into an organisation, and also the fact the management team are unlikely to have experience in it†s application, could lead to several implementing problems and introduce another element of risk. Preston et al (1992) emphasis, that when a new accounting method is introduced, it is naive to assume that by simply assembling the components of a system, that the desired or officially intended outcome will be achieved. Since 1979 the UK government has tended to favour private sector management styles and culture (Flynn 1992), although there has been many debates about the different contrasts between the adaptable, dynamic, entrepreneurial private sector management styles and the bureaucratic, cautious, inflexible, rule bound public sector management. Could this be due to the strain on public sector managers, who work on a tight budget, and also that scope for reward in expanding the organisation is limited. So can we compare managers in the public sector with those in the private sector, for example accountability structures make managers jobs different from those of the private services. A public service manager for example, could be instructed to keep a hospital open, while the regional authorities may have different ideas and wish the hospital to close. This dubious accountability has no resemblance to the private sector, where managers are ultimately accountable to shareholders (Flynn 1992). An important part of managerial work in the public sector involves managing the relationship between the organisation and the political process. Therefore, the government is faced a health policy dilemma; how to reconcile increasingly flexible NHS management and greater freedom to become competitive, with requirements for manageability of the NHS, for public accountability, and for political management (Sheaff et al 1997). The government then introduced a process to set about placing former private sector directors, into director positions of NHS trusts. Therefore directly introducing private sector experience into public sector management. However, Sheaff et al (1997) research, found that board members of trusts, with a predominant NHS background were likely to be less conservative, more flexible and less risk adverse than those with a non-NHS background. This highlights the emphasis put on different management styles associated with the public and private sector, and puts into doubt these classifications when developing the ‘strategy of managerialism† for the NHS. The new era of the NHS has left managers of trusts faced with a new dilemma, they are now accountable to producing two sets of information, finance activity and patient care activity. Clatworthy (1993) identified three users of this information, the electorate, the consumers of the public service and central government politicians. All these groups will have an interest in the NHS, but their concerns are likely to focus on different aspects of this information. This gives the managers the task of balancing two incompatible goals. As part of the NHS, trusts are charged with the intangible task of improving the state of the nations health, while also having to remain financially viable (Clatworthy 1993). Jackson (1985) perceives that by their very nature, performance indicators motivate individuals and cause them to modify their behaviour in order to meet the targets set. Could this give rise to anxieties of how managers could react to potentially bad results? Published performance indicators issued cover aspects such as percentage of patients seen by a hospital within 13 weeks. Looking at this as an example; this indicator could be enhanced by treating as a priority those that have been waiting longest, but these patients may not be those, whose health status would benefit most from treatment (Clatworthy 1993). It could be argued that in the pursuit of a goal, managers lower the possible increase in overall welfare. These performance indicators, both financial and patient care are produced in an annual report, although superficially similar to it†s private sector counterpart it is not addressed to an audience which can exercise control. Unlike a private sector shareholders meeting, the directors of the public sector trust cannot be removed from their position by a voting process, so it†s existence can be perceived as not a tool of control. This paper has analysed the introduction of the new reforms taken place in the NHS in the early nineties. The reasons for change were identified as being the change in the demographic structure of the UK population and the increased emphasis of technological advancement in medical health care, and their effect on the financial burden of the health service to the government. Changes brought about were to increase cost effectiveness and encourage efficient use of the scarce resources available to the NHS. Due to the competitive nature of the internal market, many management control techniques have been implemented to aid managers of designated hospital trusts to meet their budget targets. Due to the complexity of these systems, many trusts have had previously private sector managers, appointed as directors in charge of managing the budget. Many fears have been raised that these budget constraints and the introduction of performance indicators will have a detrimental effect on the health service†s ultimate aim, to improve the overall state of the nation†s health. It seems that managers are stuck in a conflict of interests, of whether to keep financial control of the trust, by cutting back in the overall service offered to the public.

Powerful Tactics That Will Increase Conversion Rates With Lance Jones

Powerful Tactics That Will Increase Conversion Rates With Lance Jones How are your conversion rates? Are you getting qualified leads? To drive value for your company, you need to convert audience members to customers. If you think you need help, you do. Today, we’re talking to Lance Jones, director of marketing at ReCharge, which helps its customers sell subscriptions on their Shopify stores. Lance shares powerful tactics to help you increase conversion rates. ReCharge’s biggest marketing challenges; from distractions to lack of patience Combining conversion rate optimization and audience language to communicate effectively Connecting with customers by using their words and phrases in your copywriting Formulas and techniques for successful conversion copywriting, including problem/agitation/solution (PAS) Building partnerships and relationships with niche businesses; knowing your target customer and their pain points to offer solutions Providing value back to partners by understanding their business and offering services/tools to solve problems Building trust by educating and teaching customers how to do something Focusing on a new niche; it’s difficult to commit to going narrow Links: ReCharge Joanna Wiebe and Copywriting Formulas Jesse Mecham YNAB MetaLab Flow AMP on iTunes leave a review and send screenshot to podcast@.com If you liked today’s show, please subscribe on iTunes to The Actionable Content Marketing Podcast! The podcast is also available on SoundCloud, Stitcher, and Google Play. Quotes by Lance: â€Å"The biggest challenge istrying to remain free of distractions.† â€Å"As marketers, we are too close to our products.† â€Å"Pretty much every aspect of marketing involves words.†