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QUESTIONS

A) Discuss the objective and constraints of the model. B) State the advantages and disadvantages of the identified model.

b) Amazon.com receives millions of orders each day and the logistics activities start with locating the inventory, packing the products, and then shipping the products to customers. The operational model for Amazon.com is summarized in the following text box. Not every product sold on Amazon is stored and shipped by Amazon. FBM (Fulfilled by Merchant) orders are shipped by the sellers directly to buyers. For orders fulfilled by Amazon (FBA), the order fulfillment process is as follows: Storing inventory in warehouse: Sellers send their items to different Amazon warehouses as directed by Amazon. Each product sold on Amazon is identified with a FNSKU (Fulfillment Network Stock Keeping Unit) code which is unique. So when the product inventory reaches Amazon, warehouse team scans the bar codes and stores them in location for similar products. Packaging: Basic packaging for most of the items is already done by the sellers before the product reaches Amazon Warehouse. If an additional preparation needed, Amazon will do that for the seller at extra charge. Locating the product and Shipping: When a customer buys a product on Amazon, warehouse team knows where to get the product (based on FNSKU) and then ship it to the customer. Shipping box that the customer receives from Amazon is packaged by Amazon as he/she may order multiple items. (14 marks)