Steven Zhou

Session 1: Amazon.com Case Study Questions

Assignment Questions:
1. What is Amazons business and what factors are critical to its
success? [list or table]
Amazons Businesses
Critical Success Factors
Third-party logistics company
Having warehouses throughout
the entire world
Acquisition of material handling
systems such as Kiva
Huge shipment volumes and
demands
Parcel-delivery companies such as
UPS and FedEx

Online book merchant, which

eventually expanded into other
products

Having fulfillment centers that

cost about $50 million apiece
The need for large capital
The computerization of the
warehouses
Effectiveness and efficiency of the
information systems
Declining cost of operating and
the increase in warehouses
abilities to handle more volume
Effective supply-chain
management and providing
suppliers with deep business
intelligence pertaining to publics
interests in various products

2. What challenges did Amazon face when it first entered the

marketplace? [list]
a. . The need to operate their own fulfillment centers which
cost about $50 million apiece
b. . The need to have large amounts of capital
c. . Thin profit margins
d. . The method of disintermediating the retail process by
eliminating stores and warehouses
3. What information is required by Amazon to transact, to manage,
and to innovate? [table]
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Session 1: Amazon.com Case Study Questions

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Session 1: Amazon.com Case Study Questions

Level of Information
Processing
transacting

management and control

innovation and corporate learning

Information Needs
The products customers order and
purchase
Detailed information on the time
and steps involved in fulfilling
orders
Worker error rates
Flow and turnover of inventory
Associated cost of operations data
add more rows as needed.
Established supply-chain
management systems
Fulfilling their eCommerce needs
Sales and profit numbers
Turnover and flow of inventory

add more rows as needed.

Their sales in certain areas of the
world
Pinpointing weaknesses within the
company
Being creative and innovate new
ways to help company yield
positive numbers
add more rows as needed.

4. What are the challenges associated with running a fulfillment

center versus the warehouse for a brick and mortar store chain
(hint: consider Amazons critical success factors)? [table]
Fulfillment Center Operations
Cost of operating (approximately
$50 million)
Because these centers handle the
prepared by rmk 060214

Warehouse Operations
Lack of computerization of
equipment and information
systems
Lacked the efficiency of a
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Session 1: Amazon.com Case Study Questions

orders with Amazon, consumers
are unable to view transaction
from beginning to end
Poor handling, procedures and
problems within the processes can
occur without the knowledge from
fulfillment centers.

fulfillment center
Due to lack of computerization,
there may be inaccurate inventory
Risk of wasting time and resources
by having to perform tasks
manual
Proper space utilization if layout
is not optimized, you can waste
valuable space

add more rows as needed.

prepared by rmk 060214

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