Running head: AMAZON.COM’S DISTRIBUTION STRATEGY 1
Amazon Case Study
Amazon.com’s Distribution Strategy
John H. Smith
University of Massachusetts Amherst, Isenberg School of Management
AMAZON.COM’S DISTRIBUTION STRATEGY
Abstract
Amazon has experienced explosive growth trends through their organizations history. Many of
which are a byproduct of their actions around addressing their growth strategy, and meeting their
high standards and objectives. This paper is a focused analysis of Amazon’s European
distribution strategy, based on facts and data presented through the provided case study.
Throughout this analysis, there will be six predefined questions, with answers, which tackle
numerous key topics which are covered in the Amazon case study.
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AMAZON.COM’S DISTRIBUTION STRATEGY
Amazon.com’s Distribution Strategy
US Market Shipping Attributes
Question: Using shipment attributes (for example, drop-ship, split, partnered, postal-injection),
identify the major categories, or modes, of shipment for Amazon.com in the U.S.
Executive Summary
Over the history of Amazon and their organizations growth challenges, they have
embraced numerous forms of shipment types for the US market. Amazon utilizes:
Locally stocked distribution centers (DC’s) with shipment services
Drop-ship from key manufacturers and distributors
Partnered shipment, utilizing localized carriers for certain good types
Postal injection and zone skipping by shipping between regions to DC’s
Overview
Amazon, in the early stages of their business had started with a shipment and distribution
approach which was closely aligned with their industry and product; books and media. This
meant that only a small percentage of popular titles were stored in distribution centers, and there
were key partnerships with publishers and distributors to partnership, or in some cases drop-ship
orders.
However, as the organizations growth goals changed, they needed to address their
distribution and shipping strategy to provide more options for delivery time compression, all
while still meeting their own internal key performance indicators around quality, low price, and
customer satisfaction. This resulted in adopting larger distribution centers, and reducing complex
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AMAZON.COM’S DISTRIBUTION STRATEGY
or lengthy delivery times with partner-ship options from publishers or distributors who may not
be structured to meet Amazon’s operational objectives.
Alternatively, as the product landscape evolved to more variety of goods, and not just media,
that brought more product, and new challenges. Each unique instance needing to still maintain
the high standards of Amazon, which evoked the need to readdress their distribution strategy.
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