How Amazon is Transforming Supply Chain Management

What started out as an unassuming online bookstore has now become the undisputed leader in retail. Amazon is one of the biggest success stories of the modern retail era, and its supply chain management philosophy has been instrumental in making sure it brings products to millions of people around the world in record speeds at prices that are hard to beat.

Not every company is Amazon, of course, nor do most companies have their influence or budget, but that doesn’t mean there aren’t lessons for small and mid-sized businesses to learn from them. Adopting some of Amazon’s supply chain management approaches can actually help them enjoy some of their own success.

Amazon’s Innovations Can Benefit Everyone

Amazon Prime’s free two-day shipping was a game changer when it was first introduced, but the firm was forced to up their game even further once that became a standard offering by other retailers. Amazon Prime Now can being people their orders in an hour, and now plans are in the words for drones to bring selected customers their orders in less than half an hour. The firm’s political influence could help clear the way for smaller firms to legally operate drones for making commercial deliveries.

Amazon has also been eschewing the obvious advantages of using 3PL providers for distribution, building up its own delivery vehicle fleet for same-day deliveries. Other companies could also try insourcing distribution on a smaller scale to enjoy some advantages.

While smaller businesses might not be able to compete with Amazon when it comes to drone delivery, for example, they could direct their efforts in places where they do stand to gain a competitive advantage over Amazon, such as niche product selections, customer service or product knowledge. They also need to continue keeping an eye on Amazon to gain insight into the future of supply chain management.

This blog post was based off an article from Software Advice. View the original here.

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