During its annual seller conference, Amazon announced the launch of “Supply Chain by Amazon.” This initiative is said to be a game-changer for small business owners, providing a seamless solution to move products from manufacturers to global customers.
Supply Chain by Amazon promises to revolutionize the way small business sellers manage their supply chains. With an ever-evolving global market, small businesses often grapple with the complexities of logistics, and this service aims to alleviate those pressures.
Amazon’s well-established infrastructure in logistics, fulfillment, and transportation will now be at the disposal of sellers. This means businesses can have their inventory collected from manufacturing hubs globally, transported across borders with all the requisite paperwork and customs clearances taken care of, and stored in bulk. Furthermore, Amazon will oversee the replenishment of products across all sales channels and ensure direct delivery to customers.
For small businesses, this translates to more time and resources to focus on product development, business growth, and customer engagement. Additionally, the onus of logistics, typically a complex domain with potential cost overruns, is now transferred to Amazon, which promises cost reduction and faster delivery.
Some of the core benefits for small businesses include:
- Cost Savings: Amazon’s newly revised prices offer discounts of up to 25% on cross-border transportation for items heading to Amazon Warehousing and Distribution (AWD). Domestic transportation will also see a cost reduction with the introduction of the Partnered Carrier Program (PCP), which promises efficient domestic transportation at 25% lower costs.
- Bulk Storage Options: With AWD now available to all sellers, inventory can be stored in bulk at up to 80% less cost than Amazon’s Fulfillment by Amazon (FBA) storage fees. Significantly, there are no peak prices even during the high-demand Q4 holiday season.
- Multi-Channel Distribution (MCD): This novel feature allows sellers to move products in bulk from AWD to any sales channel, ensuring that businesses can efficiently manage inventory across all their sales avenues, be it on Amazon, other online platforms, or physical stores.
- Automatic Inventory Replenishment: Amazon’s advanced machine learning and supply chain optimization will ensure that inventory is automatically restocked at Amazon fulfillment centers. This offers faster delivery speeds from FBA and supports off-Amazon channels via Multi-Channel Fulfillment (MCF). Optimal product placement can lead to quicker delivery times, potentially boosting unit sales by 15%.
Dharmesh Mehta, Amazon’s vice president of WW Selling Partner Services, emphasized the company’s commitment to aiding sellers. He remarked, “With Supply Chain by Amazon, Amazon will pick up sellers’ inventory directly from their factory, and manage the supply chain logistics through delivery to customers’ doorsteps.”
Small business owners looking to harness the power of Amazon’s vast logistics network and redefine their supply chain management can learn more about Supply Chain by Amazon on the company’s dedicated page.
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