Amazon.com E-Books Supply Chain Introduction

Amazon.com E-Books Supply Chain

Introduction of Amazon.com

As one of the world's leading online retailers, Amazon.com continues to successfully expand its core business into related product sales, services, Web Services development (Amazon Web Services) and their e-books program, eDocs. The intent of this analysis is to evaluate their eDocs program's supply chain. At the close of the company's latest fiscal year on December 31, 2009 the company reported total revenues of $24.5B, Operating Income of $1.1B and Net Income of $902B. Amazon.com continues to expand successfully into new businesses through acquisition, the most noteworthy being acquiring shoe retailer Zappos.com for $800M. The company divides its regions between North America and International. The North American division concepts on The company operates through two geographical business segments: North America and international. The North American segment focuses on retail sales and handles subscriptions through websites including www.amazon.com and affiliate sites, in addition to managing the Amazon Web Services (AWS), a popular Web hosting and online storage division of the company. AWS has become popular with social networking startups and currently hosts Twitter for example. According to Compete.com, a research firm that specializes in tracking website traffic, Amazon.com gets visits from 650 million visitors a year globally (Isckia, 2009). This places them ahead of WalMart.com and many of the world's most well-known websites. Amazon.com's senior management credits their consistent growth for first defining their supply chains and distributed order management systems first before launching their online retailing websites and promoting them heavily (Penenberg, 2009). The intent of this analysis is to evaluate the supply chain for their e-books as Amazon.com calls them, their eDocs Program.

Supply Chain Strategy for eDocs

When Amazon.com launched their eDocs Initiative in 1996 they deliberately created a supply chain that could quickly scale from the smaller, independent publishers it the global leaders in digital content and e-books (Beisser, 2007). How Amazon.com accomplished this is by creating a manual, single-titled-based workflow for smaller independent publishers to upload their books while creating bulk, automated load sequences for the larger publishers. The eDocs program for years did not have reporting accessible for either the individual or large publishers which led to the need to reconcile sales often, as publishers often debated how many copies of their e-books had been sold (Isckia, 2009). Within the last two years however Amazon.com has added in analytics, and while they are still not real-[time, they are a vast improvement over the 30 to 60 day lag time to get sales results from the past. This increase in reporting efficiency has led to more e-book publishers signing into the program (Isckia, 2009).

Supply Chain and Process Map

The following is a representation of the Amazon.com eDocs supply chain process map.

Amazon.com has over the last several years seen their eDocs business grow faster than their book business (Penenberg, 2009) and as a result have focused on streamlining the entire supply chain electronically, which is a core strength of this company. Figure 1 provides an overview of how Amazon.com has organized their IT systems to support and streamline their supply chain performance.

Figure 1:

How Amazon.com supports the eDocs Supply Chain Electronically