answer this please

Case Study 2: Amazon On Cyber Monday, December 1, 2014, Amazon.com customers ordered more than 18 toys per second. And almost 60 percent of Amazon's holiday shoppers bought gifts using a mobile device. This contributed to a 20 percent increase in Amazon's total annual sales of $89Billion. Amazon's last order for the holiday season was placed on December 24 at 10:24 PM and was delivered at 11:06 PM just in time for Christmas You may think of Amazon as simply an online retailer, and that is indeed where the company has achieved most of its success. To do this, Amazon had to build an enormous supporting infrastructure just imagine the information systems and fulfillment facilities needed to ship 36.8 million items on a single day. That infrastructure, however, is needed only during the busy holiday season. Most of the year, Amazon is left with excess infrastructure capacity. Starting 2000, Amazon began to lease some of that capacity to other companies. In the process, it played a key role in the creation of what are termed cloud service. Cloud services can be simpley described as computer resources somewhere out in the Internet that are leased on flexible terms. Today, Amazon's business lines can be grouped into three major categories: 1. Online retailing 2. Order fulfillment 3. Cloud services 1. Online retailing Amazon created the business model for online retailing. It began as an online bookstore, but every year since 1998 it has added new product categories. The company is involved in all aspects of online retailing. It sells its own inventory. It incentivizes customers, via their Associates program, to sell its inventory as well. It also will help customers sell inventory within its product pages or via one of its consignment venues. Online auctions are the major aspect of online sales in which Amazon does not participate. It tried auctions in 1999, but it could never make inroads against eBay. Amazon's retailing business operates on very thin margins. Products are usually sold at a discount from the stated retail price, and 2-day shipping is free for Amazon Prime members (who pay an annual fee of $99). How does it do it? For one, Amazon drives its employees incredibly hard. Former employees claim the hours are long, the pressure is severe, and the work- load is heavy. But what else? It comes the innovative use of nearly free data processing, storage, and communication. 2. Order Fullfillment - Fulfillment by Amazon (FBA) In addition to online retailing, Amazon also sells order fulfillment services. Using technology known as Web services, any business order processing information systems can directly integrate, over the Web, with Amazon's inventory, fulfillment, and shipping applications. 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. FBA customers can sell their goods on Amazon.com, sell them via their own sales channels, or both. If the FBA customer sells on Amazon.com, Amazon will provide customer service for order processing (handling returns, fixing erroneously packed orders, answering customer order queries, and the like). The costs for Fulfillment by Amazon depend on the type and size of the goods to be processed. If goods are sold via Amazon.com, Amazon uses its own information systems to drive the order fulfillment process. However, if the goods are sold via an FBA customer's sales chan- and order fulfillment business processes and information systems to fulfill the FBA customers' orders. FBA customers can sell their goods on Amazon.com, sell them via their own sales channels, or both. If the FBA customer sells on Amazon.com, Amazon will provide customer service for order processing (handling returns, fixing erroneously packed orders, answering customer order queries, and the like). The costs for Fulfillment by Amazon depend on the type and size of the goods to be processed. If goods are sold via Amazon.com, Amazon uses its own information systems to drive the order fulfillment process. However, if the goods are sold via an FBA customer's sales chan- nel, then the FBA customer must connect its own information systems with those at Amazon. Amazon provides a standardized interface by which this is done called Amazon Marketplace Web Service (MWS). Using Web-standard technology, FBA customers order and payment data are directly linked to Amazon's information systems. FBA enables companies to outsource order fulfillment to Amazon, thus avoiding the cost of developing their own processes, facilities, and information systems for this purpose. 3. Cloud Services Amazon Web Services (AWS) allow organizations to lease time on computer equipment in very flexible ways. Amazon's Elastic Cloud 2 (FC2) enables organizations to expand and contract the computer resources they need within minutes. Amazon has a variety of payment plans, and it is possible to buy computer 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 ramp-up of traffic, that news site can, programmatically, request, configure, and use more computing resources for an hour, a day, a month, whatever. With its Kindle devices, Amazon has become both a vendor of tablets and, even more importantly in the long term, a vendor of online music and video. And to induce customers to buy Kindle apps, in 2013 Amazon introduced its own currency, Amazon Coins. In 2014, Amazon opened a 3D printing store from which customers can customize their own toys, jewelry, dog bones, and dozens of other products. It also made push to provide video services by introducing Fire TV. In 2015, Amazon introduced WorkMail, a potential cloud-based replacement for Microsoft Exchange. It also introduced Amazon Home Services (local professional services), Amazon Destinations (travel site), and Amazon Dash (a one-button reordering device). Finally, Jeff Bezos announced in 2014 that Amazon was experimenting with package delivery using drones, a service called Prime Air. In March 2015, the U.S. Federal Aviation Administration gave Amazon permission start testing its drones in the United States. Answer the following questions: Based on the facts presented in this case, what do you think is Amazon.com's competitive strategy? Justify your answer. 2. What should UPS and FedEx be doing in response to Amazon.com's interest in drone delivery? 3. Summarize the advantages and disadvantages for retailers to use Fullfillment By Amazon (FBA) to sell their items via Amazon.com. Would you recommend that they do so