Questions
1. Should Amazon.com have remained an online bookstore? What are the advantages and disadvantages of diversification?
2. Identify the strategic and tactical/operational activities of supply chain management for Amazon.com and explain how each was used to achieve competitive advantage over a brick-and-mortar store.
It is universally accepted that Amazon.com is the company most closely associated with the e-commerce phenomenon. Based in Seattle, Amazon.com started as an online retailer of books in 1995. Since opening for business as “Earth’s Biggest Bookstore,” Amazon.com has quickly become one of tire most widely known, used, and cited commerce sites on the Web. The company has grown at a tremendous rate with revenues rising from about $ 150 million in 1997 to $19 billion in 2008. Amazon.com customer base grew from 1.5 million in 1997 to 88 million in2009. However, the rise in revenue and number of customers was not accompanied by a rise in profits. After several years in which large operational losses were accumulated, it was only in the fourth quarter of2001 that the company made Its first quarterly profit of $5 million and this was achieved during the holiday season.