108 CHAPTER 3 Strategy and information Systems inventory fulllment, and shipping
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108 CHAPTER 3 Strategy and information Systems inventory fulllment, and shipping applications. Your custom- ers need not know that Amazon played any role at all. You can them via their own sales channels, or both. If the FBA customer also sell that same inventory using Amazon's retail sales sells on Amazon.com. Amazon will provide customer applications any role at alt FBA customers can sell their goods on Amaczon.com, Amazon Web Services (AWS) allow organizations to lease orders. answerngcustomer order que time on computer equipment in very flexible ways. Amazon's Elastic Cloud 2 (EC2) enables organizations to expand and con- size of the goods to be proces tract the computer resources they need within minutes. Amazon products as of Ap has a variety of payment plans, and it is possible to buy com puter time for less than a penny an hour. Key to this capability is the ability for the leasing organization's computer programs to interface with Amazon's to automatically scale up and scale down the resources leased. For example, if a news site publishes a story that causes a rapid programmatically, request, configure, and use more computing order processing (handling returns, fixing ill provide customer service for erroneously packed and the like costs for Fulilment by Amazon depend on the type and sed. The FBA fees for standard-size il 2016 are shown in the table. FBA CostS scale up and scale Order handing (per order) $1.00 ramp-up of traffic Pick & pack (per item) 31 06 .that news site can Between $0.50 for less than 1 pound, to $1 95 plus $0.39 per pound for items over 2 pounds sources for an hour, a day, a month. whatever Weight handling With its Kindle devices. A er pound) of tablets and, even more importantly in the long term, a vendo of online music and video dle apps, in 2013 zon Coins. In 2014. opern which customers can customize their own toys, jewelry, dog information systems to drive the bones, and dozens of other products. It also made a push to pro- ever. if the goods are sold via an FBA vide video services by introducing Fire TV.16 mazon has become both a vendor Storage (cubic foot $0.54 between January and Sep- tember and $0.72 from October to December And to induce customers to buy Kin introduced its own currency. Ama mazon opened a 3D printing store from If goods are sold via Amazon.com. Amazon uses its own then the FBA customer m ust connect its own iniorma In 2015 Amazon introduced WorkMail, a potential cloud- tems with those at Amazon. Amazon provides a standardized interface by which this is done called Amazon Marketplace Web based replacement for Microsoft Exchange. It also introduced Amazon Home Services (local professional services Destinations (travel site), ing system), Amazon Books (a physical retail location). and Amazon's information e), and it started Amazopayata are Chupter FBA enables companie Using Web-standard technology (see Chapter 61. ment data are direetly limked to outsource ordex fuililiment nd information systems for this purpose Amazon Echo (a voice-enabled order- FBA customers order and pay selling semiconductors after acquiring Annapurna Labs.17 By Amazon thus avoiding the cost of developing thetr oen mid-2016 Amazon announced its new Kindle Oasis and the launch of its new Payments Partner Program designed to com- pete with PayPal. Apple Pay, and Visa. mazon Dash (a one-button reordering device). and it started Finally, Jefl Bezos announced in 2014 that Amazon was experimenting with package delivery using drones, a service called Prime Air. 18 In 2015, Amazon was given permission to start testing its drones in the United States but was hampered by 0.S. regulations. Consequently, by mid-2016 Amazon expanded its testing to Canada, the United Kingdom. and the Nether- lands.19 But drone delivery is something that will happen in the future; consider a business service that Amazon.com is offering right now. Fulfillment by Amazon (FBA) Fulfillment by Amazon (FBA) is an Amazon service by which other sellers can ship goods to Amazon warehouses for stocking. order packaging, and shipment. FBA customers pay a fee for the service as well as for inventory space. Amazon uses its own inventory management and order fulfillment business processes and information systems to fulfill the FBA customers' orders. 10 Case Study 3 3-11. If a brick-and-mortar retailer were to use information systems nd disadvantages forExplanation / Answer
3.11
If brick-and-mortart would like to go for the FBA services by Amazon then they would have to integrate their ordering system with that of Amazons MWS system which will handle order processing, packaging, delivering the products. If they implement the system, they would save the storage cost, order handling and delivery cost, packaging cost etc which would result into a great savings on larger scale for the company.
3.12
If it would like to integrate FBA services with Amazon, seller will have to integrate their information system with Amazon's MWS (Marketplace Web Service) which provides interface for the seller to built their own services. MWS mainly provides 3 services which are Inventory Management, Order Management and Report Management to all the suppliers connected through it. It also allows you to managed full fledged service for Inbound orders as well as outbound orders with tracking services. Thus connecting with MWS will enable to cater large crowd and generate greater sales for the suppliers.
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