Amazon.

com
Developing same day delivery capabilities
INTRODUCTION
 Amazon.com, Inc. (Amazon) headquartered in Seattle,
Washington, US, was the world's largest online retailer. It started as
an online book store but later diversified its offerings to DVDs,
CDs, MP3 downloads, software, video games, electronics, apparel,
furniture, food, toys, and jewelry. It allowed manufacturers and
sellers to sell their products through its websites. It further offered
its own consumer electronic products like the Amazon Kindle e-
book reader and the Kindle Fire tablet computer. It was also a
major provider of cloud computing services. By December 2012,
the company had separate retail websites for the US, Canada, the
UK, France, Germany, Italy, Spain, Brazil, Japan, and China with
international shipping facility to a few other countries...
Amazon's Business Model and Supply Chain

 In 2013, Amazon.com was a Fortune 500 company and

a global leader in e-commerce. It had a wide array of
products, international sites, and a worldwide network
of fulfillment centers and warehouses and customer
service centers. It had developed a customer base of
around 30 million people. The company was a retailing
site that followed a sales revenue model and made
money by taking a small percentage of the sale price of
each item sold through its website. It also allowed
sellers to advertise their products by paying a fee...
Amazon's Same-Day Delivery
 Over the years, Amazon had been pitching on the price of the products it
offered to compete with other players. It offered products at very low
prices as it did not charge customers sales tax on the products. For
instance, when a customer purchased a laptop of about $1000 from a
brick and mortar store, the company collected local sales tax of say
$100, and the customer ended up paying $1100. However, Amazon was
exempt from the rule. The 1992 US Supreme Court ruling said that ‘only
firms with physical presence in a state are required to collect taxes from
residents'. Amazon avoided having a physical presence in the states that
required e-tailers to charge sales tax. This helped it keep its prices low as
it followed the strategy of locating its distribution centers far away from
such states. So, when a customer from California ordered a laptop,
Amazon shipped it from its warehouses located in some other state...
Competitors too Join the Fray
 Though Amazon's same-day delivery was considered
by many as a game changing strategy in which the
company could succeed by leveraging on its strong
supply chain, Amazon had a bigger challenge ahead –
competitors too began offering same-day delivery
service. In October 2012, Walmart, hoping to beat
Amazon, began testing its same-day delivery business
model for products that were sold online in the US
markets. It had been experimenting with the model in
San Jose, California, for more than two years.
Competition to Intensify
 With the introduction of online shopping of books (and later
expanding the product range), Amazon.com had time and again
changed the consumers' shopping habits. It also helped in the
growth of global online retail. But earlier, Amazon was not
able to deliver products to its customers immediately. Its
competitors, the local brick and mortar stores, were at an
advantage as they offered the service. However, in 2013,
Amazon tried to reach its customers faster with the same-day
delivery model. Industry experts opined that this development
could have significant consequences for local brick and mortar
stores. "Everybody in retail is terrified of Amazon," said
research analyst Sucharita Mulpuru...
Challenges on the Way
 Amazon, unlike the other big companies like Google, Apple,
Microsoft, etc., did not invent any new product or service, but grabbed
power by systematically taking down an entire existing industry. It
adopted a strategic approach to its business. Other companies made
strategic moves occasionally and in isolation, but Amazon made its
moves continuously, thinking multiple moves ahead on several fronts.
Amazon neither created a new market like Apple nor competed with a
single company, but it disrupted an entire industry. Amazon took on
every part of the supply chain of the retail industry.
 E-commerce experts opined that the success of Amazon's same-day
delivery experience in the future would hinge on its supply chain and
fulfillment capabilities, and the continuation of its popular pricing
strategies...
CONCLUSION
 E-commerce and the consumer's desires had changed retail
logistics, pushing down the delivery times from a few weeks
to a day or even less,
 Retail companies developed exclusive applications for same-
day delivery to make it easier for customers to purchase
goods over the internet.
 Software and phone companies like Apple and Google also
had specific roles to play in making this same-day delivery
work.
 This may increase effecincey and decrease waste by receiving
goods only as they need them (just in time production)