Amazon.com – behind the scenes
Amazon is notoriously famous for carrying out its business operations in complete secrecy. Most of its earning calls are devoid of any actual numbers. i.e. Number of units sold for its kindle line of tablets. So it came as a complete surprise when the Jeff Bezos led company gave WIRED a tour of one of its warehouses in Phoenix.
The warehouses, termed ‘fulfillment center’ by Amazon are scattered all over the world, with more than 90 fulfillment centers currently operating on a daily basis. Amazon’s relation with its third party vendors is kept far from the spotlight, also owing to the company’s non disclosure nature. But according to Wired, more than 2 million third-party vendors supply around 40% of all of items sold on Amazon. These items are shipped into fulfillment centers located around the world.
Amazon currently has 2 functional warehouses in India, one located in Bhiwadi, Mumbai and one in Bangalore. Amazon’s meteoric rise in retail is not credited enough to it’s third party suppliers, with most people inconspicuous of any third party involvement in Amazon’s operations.
“Most consumers don’t even realize third parties are involved. They just trust Amazon so much that they don’t really know or care,” Scot Wingo, CEO of e-commerce analysis company ChannelAdvisor, told Wired. This allows Amazon to exercise complete over it’s supply chain thereby providing a degree of efficiency and quality control which a small scale retailer just wont be able to compete with.
When you buy a product “sold by Amazon” but it is being supplied by a third party, Amazon finds an item that’s located in a warehouse closest to your location. A lot of times the item will even match the one you ordered for but will be supplied from a different seller, though the first will get credit for the sale. This enables Amazon to deliver products at a speed which is unparalleled in the entire industry.
To put things into a clearer perspective more than 1 billion items sold on Amazon last year came from third-party sellers.