Designing

Distribution Network
and its application to
E-business
Presented by:

Devang Mehta
2018079
 What is Distribution?
 The steps taken to move and store a product from the supplier stage to the
customer stage in a supply chain
 It affects the cost and customer experience thus driving profitability
 Examples for similar distribution include
o Walmart, Seven Eleven
o Dell, Apple

Factors Influencing Network Design :

Performance of a distribution network is evaluated along two dimensions:
 Customers Needs that are met :
o It includes factors like response time, product variety, product
availability, customer experience, order visibility

 Cost of meeting customer needs :

o It includes factors like Inventory, Transportation, facility and handling
and information
Design Options for a Distribution Network
 Manufacturer Storage with Direct Shipping

 Manufacturer Storage with Direct Shipping and In-Transit Merge

 Distributor Storage with Carrier Delivery

 Distributor Storage with Last Mile Delivery

 Manufacturer or Distributor Storage with Consumer Pickup

 Retail Storage with Consumer Pickup

o In the further slides we will witness how the distribution network design options
are used and applied in E-business field by E-commerce giant Amazon
 Amazon.com, Inc. is an American
multinational electronics commerce company with
headquarters in Settle Washington, United States.
It is the world's largest online retailer. They started
as an online bookstore but have diversified to so
many other products like music downloads,
furniture, food and basically almost all consumer
electronics. Currently, Amazon is a major a
provider of cloud computing services. Amazon’s
has a separate retail online stores for different
countries for example the USA, UK, China, Italy,
Germany and others.

With a brand value of $315.5 billion,

Amazon is now more valuable than Apple
and Google, according to BrandZ Top 100
Most Valuable Global Brand ranking 2019
Distributor Storage with Carrier Delivery
Automated pick-pack-ship processes
PUBLISHER/
WHOLESALER
SUPPLIER
PRODUCT
INFORMATION INFORMATION

AMAZON Other Sellers

INFORMATION PRODUCT
INFORMATION

CUSTOMER

-
Amazon selects Infor for Global Business
 Infor has inked a deal with Amazon that will see the ecommerce giant
running its transportation and logistics in part on the GT Nexus platform

 Amazon has selected GT Nexus as its supply chain and ecommerce

platform so as to integrate the supply chain information across its partners
and suppliers

 The GT Nexus platform would provide Amazon with a single network

connecting its suppliers and partners across the globe

 It would give it visibility of its whole supply chain, identifying where goods
are and allowing it to save on inventory costs even further
Impact of E-Business on Customer Service
o Faster
 Response to customer orders
 New Product Introductions
 Modifications of Product portfolios, pricing, promotions
 Revenue Collection

o Product variety
 Varied number of products are available

o Product Availability
 Number of products in the storage increases

o Customer Experience
 Customers feel it easy to use, after hours shopping and distant shopping
becomes possible due to E-business
Impact of E-Business on Cost
o Inventory
 Improved information and aggregation potential

o Facilities
 Simplification of order taking
 Increased handling of products

o Transportation
 Aggregation increases the outbound transportation costs

o Information
 Increased demand visibility
 Increased supplier visibility