Assignment task: Amazon's Global Logistics Facilities Network
Jeff Bezos founded Amazon.com in 1995. Amazon's corporate mission is to be the "Earth's most customer-centric company." Amazon is guided by four principles: customer obsession rather than competitor focus, passion for invention, commitment to operational excellence, and long-term thinking. The company's global operations are in the United States, Australia, Brazil, Canada, China, France, Germany, India, Italy, Japan, Mexico, Netherlands, Spain, and United Kingdom. The company directly employs 1.3 million people worldwide. There are more than 1.9 million small and medium-sized businesses selling on Amazon's website. They have 200 million global Prime members and in 2020 their total net income was $21.33 billion.5 The early belief in electronic commerce was that millions of customers could be served without requiring the infrastructure of a Sears or Walmart. Today, online retailers are finding that without their own warehouses and shipping capabilities, customer service can suffer.
The objective is to improve logistics and reduce shipping times to customers. The company currently has several facility types including Fulfilment Centers/Distribution Centers (DCs), Pantry/Fresh Food Fulfillment Centers, Sortation Centers, Delivery Stations, airport hubs, and Prime Now Hubs, totaling 838 in the United States.6 Other worldwide logistics facilities located in Europe are in Austria, Czech Republic, France, Germany, Italy, Netherlands, Poland, Republic of Ireland, Slovakia, Spain, Sweden, and the United Kingdom. In Asia, the fulfillment centers are found in Australia, China, India, Japan, and Singapore. Amazon also has logistics facilities in Canada, Mexico, and Brazil. Outside the United States, Amazon has 723 such facilities/centers/ hubs. Amazon's massive logistics network far exceeds that of any retailer in terms of scale and coverage. By strategically locating its logistics facilities and improving its operations, Amazon is able to provide faster customer service globally. Although Amazon uses third party logistics companies such as UPS, FedEx, and DHL for delivery, it has built its own fleet of delivery vehicles especially for its Prime customers. Amazon's "Last Mile" delivery for small packages involves Amazon Sprinter vans, independent Amazon flex drivers, and other local courier companies. To achieve Amazon's goal of one-day delivery for its Prime customers, the location of fulfillment centers is critical. Amazon also launched The Climate Pledge in September 2019. The pledge requires their transportation providers to measure and report greenhouse gas emissions regularly and to implement decarbonization strategies. Transportation is a major part of Amazon's business and it has a goal of achieving net zero carbon by 2040. As such it is investing more than $1 billion in Rivian to deliver 100,000 electric vans.
Question: Discuss if you think Amazon is on the right track in terms of logistics strategy and why or why not.