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Global Marketing

Amazon’s Global Logistics

Amazon has disrupted the ecommerce world and quickly became one of the biggest companies in the world. One of its biggest selling points is its Amazon prime next day delivery. This is something that was never seen before in the ecommerce industry, providing consumers with convenience and efficiency. Delivery time was a big barrier that prevented consumers from shopping online as they didn’t want to wait for their purchases to arrive. Amazon managed to solve this problem through its distribution logistics.

According to its 2017 annual report, more than a quarter of its third-party sales are cross border. In 2018, Amazon had 258 operational facilities in the United States and another 486 around the world, totaling more than 243.5 million square feet. Amazon has its own fleet of delivery trucks and total of 32 Boeing 767-300s in 2018. In the US, items are delivered to local distribution centers from Prime Now hubs to fulfillment, sortation, and delivery stations to Whole Foods. They also operate 9 inbound cross dock centers, which consolidates, and sorts imported products and sends them to different distribution centers.

Amazon manages all of this through its Amazon Global Logistics system. Sellers can sell their products through the system shown below. This makes it easier for both the seller and Amazon as sellers don’t need to do any of the shipping and delivering themselves and Amazon can automate and gain data on everything in the supply chain.

Amazon-FBA-Fulfillment

Even though Amazon delivers most if not all of its products by itself in the US, it does rely on other intermediaries to reach its consumer in foreign countries. For example, in Japan, Amazon Japan utilizes freelance truck drivers to deliver its products in order to try and compete with local e-commerce that offers quick delivery. Amazon Japan now promises to deliver packages as fast as two hours after ordering. By using intermediaries, drastically lowers Amazon's initial costs and increases the speed of entry.

Citation:

https://asia.nikkei.com/Business/Services/Amazon-Japan-builds-army-of-freelance-drivers-Uberstyle

How the Amazon Supply Chain Strategy Works