Amazon, the leading e-commerce giant, has expanded its logistics operations by introducing ‘Supply Chain by Amazon,’ a comprehensive suite of supply chain services designed to facilitate seamless product movement from manufacturers to customers worldwide. This innovative system leverages Amazon’s advanced logistics capabilities to provide sellers with improved transportation, efficient fulfillment, optimized inventory management, faster and more reliable shipping, all while reducing costs.
Dharmesh Mehta, Amazon’s Vice President of WW Selling Partner Services, explained that this platform enables Amazon to directly collect sellers’ inventory from their factories and manage the entire supply chain logistics, from warehousing to doorstep delivery. Sellers can now delegate the complexities of their supply chain logistics to Amazon, whether their products are sold on Amazon’s platform or through various online or physical sales channels.
Key benefits of this logistics expansion include:
- Automatic Cross-Border Discounts for Amazon Global Logistics (AGL): Sellers using Supply Chain by Amazon will receive additional discounts on cross-border transportation to Amazon Warehousing and Distribution (AWD), complementing the existing 25% discount.
- Streamlined Domestic Inbound Transportation to AWD with Partnered Carrier Program (PCP): Starting from 2023, sellers can take advantage of the PCP to simplify domestic transportation into AWD centers.
- Expanded AWD Offering with Reduced Prices: AWD is now accessible to all selling partners, offering bulk storage at discounts of up to 80% compared to Fulfillment by Amazon (FBA) storage fees.
- New Multi-Channel Distribution (MCD) Capability: Sellers’ products can be moved in bulk from AWD to various sales channels, allowing them to replenish inventory across all their sales and fulfillment channels, not limited to Amazon, from a unified inventory pool.
- Automatic Inventory Replenishment with FBA: Amazon will utilize advanced machine learning and supply chain optimization to automatically restock inventory in optimal Amazon fulfillment centers, ensuring timely fulfillment of customer orders. This benefits sellers with faster order processing through FBA and fulfillment of off-Amazon channel orders via Multi-Channel Fulfillment (MCF).
The service is currently in a testing phase and is available to a select group of sellers, with plans to make it accessible to all sellers by the end of 2023. This development comes as rival companies such as Walmart, Shopify, and Flexport also expand their e-commerce fulfillment capabilities.
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