required : 1 : Develop And Analyze Alternative Solutions :

indintfy altirnative solutions + analyze them all + the selected preffred option

2 : Recommend Case Solution :

Create the implementation plan for the prffered option + detailing how to achieve the business objective + How to mitigate the project risks

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Identify new market opportunities to be exploited

Amazon success in retail business fueled Jeff Pezos ambition to break into new business sectors that are unimaginable few years earlier. Its unmatchable leadership in e-commerce laid the bricks for it taking over the retail business of books, music, toys, sports, electronics and many other products. There are many business sectors that Amazon may easily invade, utilizing its unrivaled expertise in data collection and its highly complicated supply chain systems & facilities.

Insurance

Just like its competitors and courier companies, and despite the fact that they are usually reliable, shipments still get lost, damaged or even stolen. Thus, many of Amazons customers needs to insure their shipments against these risks. Surveys shown that when a shipment is lost or damaged, customers expect replacements to be expedited, refunded or expect discounts on their shipping costs. Putting that in mind, and instead of incurring insurance costs to cover the cover of the cost of lost or damaged goods, Amazon picked up the golden opportunity to start its own insurance business.

Amazon already taken steps to build its insurance line. These steps started with launching its UK service Amazon Protect that provides insurance on products sold via Amazon. In 2017, Amazon took another step towards laying the road for its growing insurance business line in the current markets, and to create new innovative insurance products that will enrich customers experience. These two steps were followed by investing in Acko, and Indian based new insurance company providing services to vehicles and motorbikes. Then, it applied for the license of selling health, life and general insurance products. During 2019, Amazon launched Amazon Care, its own health insurance services for its employees in Seattle. Amazon is already providing its employees with medication delivery, app-enabled house calls and telemedicine services. And in 2020, Amazon sent a survey to its merchants regarding their existing insurance plans needs, which indicates an ambition to expand its current employee insurance services to its merchants, in all types of insurance.

Luxury Clothing

Amazon is already in the business of selling clothes, shoes and accessories. And as online marketplaces are still growing because of shoppers continued search for safer and more convenient ways to shop as Covid-19 continues, Amazon decided to capitalize more on this shifting consumer behavior, and to target high end consumers. During 2020, it started its Luxury Stores in order to attract expensive brands to sell their products on its platform. This store is only available to a specific group of customers, with Oscar De La Renta as its first partner. Amazon intends to add more brand names, despite the fact that the number of companies signing up is less than expected. Amazon may not become an exclusive market place for luxury goods in the near future, but once these brands comprehend the exposure, marketing and new sale channels it provides them with, it will ultimately be a premier market place.

Smart home

With the fast & huge advancements in tech world in recent years, the concept of smart homes emerged. The idea behind smart homes, is to connect home appliances and devices in order to simplify the lives of the occupants. A smart home is an environment connected with high tech devices, that interacts in response to the requirements of the occupants and changes in its surroundings. Supporting this concept needs the integration of technologies from different areas, and these should interact seamlessly, reliably and in a secure manner. Being a tech-giant, Amazon quickly realized the huge potential of this market and started its research and development activities early. By 2014, Amazon introduced its first ever product of this new sector, Amazon Echo smart speaker. The competitors followed its footsteps, but Amazon is till leading the market, as its been providing the market with many of the smart devices.

One of the initiatives taken in this area was partnering with Lennar, one of the US biggest home construction companies, where its new homes provides built-in smart home capabilities powered by Amazons Alexa. Another initiative was investing in 30 smart-home related arrangements through Alexa Fund, and that included acquiring connected doorbell Rings for $1 billion, and Wifi mesh network company Eero. Despite these initiatives, the growth of this market is remains slow, as almost 80% of the Americans are still purchasing conventional appliances and devices, which puts the future of this sector into question.

Home and garden

While the gardening sector was already struggling back in 2018, Amazon started its Plants store. Amazon believed that its vast logistics and distribution experience would result in making this sector a very profitable one for the company. Unlike older consumers, young consumers perceive gardening and plants as product or service, not as a hobby or a pastime activity, as they want the plants but do not have the necessary time to look after them. Thus, creating this business opportunity for Amazon, specifically in the midst of Covid-19 pandemic, as taking care of plants became the way some people experience nature while they are stuck at home. As a result, plants industry grew almost 8.6% in 2020. Other aspects where Amazon outperforms traditional smaller gardening shops includes plants shipping, weather changes, changes in water restrictions and increasing demand for stronger plants.

The need to relocate business operations and manufacturing facilities

A recent trend during the last 2 decades for major international corporations is to relocate their business headquarters and manufacturing facilities. This relocation decision is never an easy one to take, as moving the headquarter or the manufacturing facilities to other far away locations can be very expensive, very disruptive to the companys operations, and may strongly impact expansion opportunities.

As it was proved by many major companies, moving may also result in provisioning opportunities that do not exist for the business in its current locations. From analyzing many examples in different industries, we find that the main reasons for a company to relocate includes, but not limited to the following:

1- Reducing operating costs

One of the most important reasons that leads to company being competitive or not is operating cost. These include very high taxes, staff costs (which comprise salaries & wages, insurance costs and other related expenses), and rigorous environmental and legal regulations.

2- Obtaining more space

Another very important reason for relocation is the need for more space for the operations, once the current location becomes insufficient to achieve the things they need to do. Management reaches such conclusion when they determine that expanding in the current location is not economically feasible, or the surrounding area is not physically enough for the intended/needed expansion.

3- Becoming closer to an important market, or to penetrate a new one

If a specific market very important to the company is located in a specific region, then very long distances might be an obstacle, because it leads to longer time and more money. By opening operations in that region, the company will probably save lots of money with regards to transportation expenses and products delivery time.

4- Becoming closer to its suppliers or necessary natural resources

With regards to suppliers and required natural resources, the same factors that apply to customers/market mentioned above applies for them. Faraway locations mean higher transportation expenses and higher response/ delivery time.

5- Attracting & obtaining better or larger pool of workforce

In these current times, human resources one of the most critical reasons for a business relocation decision. In some cases, a company or manufacturing plant grows so much that the current region can no longer supply an adequate number of workers, or workers with necessary skills and experiences.

6- To update and modernize facilities & equipment

Occasionally, an existing facility or equipment of a company has become so obsolete that the company reaches a point where it either build a facility or relocate to another city. Most of the companies do not have the time or the money to build a new facility, thus relocating will be the more convenient and affordable option.

7- Getting rid of labor-related issues

Occasionally, companies and factories may encounter some issues with their labor forces, such as expensive benefit packages, labor strikes, etc. creating the need to other locations where labor packages are much cheaper, and where the risk of strikes and other issue are much lower.

8- Becoming closer to similar type of companies

Its a common practice for companies in the same industry to group within the same area. This is done to increase productivity by which companies can compete. An example of this is, The Digital Media City for multi-media, IT, and entertainment in South Korea, and Silicon Valley in the USA, where major high-tech companies are situated next to one another.

9- Downsizing

In many instances, a company simply has more production facilities than it really needs, resulting in incurring high expenses and becoming less competitive. Therefore, it may have to close some of the less efficient facilities in order for the company to survive and remain competitive.

10- Improving quality of life

The comfort and happiness of employees significantly impacts productivity of the company. So, when a company finds a city that provides a better quality of life, the decision to relocate to that city will eventually determine the success of the company, as it will be easier for the company to attract and recruit employees of top-quality.