Amazon Warehouse Management: Strategies for Improved Efficiency

Boston University MET AD856 01 Market and Economic Research and Analysis Fall 2023 Assignment 1 Amazon: Warehouse Management Jia Dong Contents: 1

Executive Summary…………………………………………………………...…….3 Background………………………………………………………………………….4 Management Decision Problem (MDP)………………………………………….…4 Market Research Problem (MRP)…………………………………………………..4 Approach……………………………………………………………………………5 Conclusion…………………………………………………………………….……5 Reference………………………………………………………………………..….6 Amazon Jia Executive Summary 2

Amazon's warehouse system is one of the main reasons for its success, because speeding up the transportation and distribution of orders, which is also the great challenge facing the e-commerce industry. Amazon fulfillment centers can not only store their own goods, but also store inventory for third-party sellers. In order to meet the needs of consumers for logistics and transportation, “ They concentrated on continuously reducing his delivery times. Most Amazon users got used to two-day delivery, while some areas even have access to same-day delivery, leaving physical retailers to run for their money.” (Rawat, n.d ) Amazon is able to do this mainly thanks to warehouse management. “Specifically, it has built out a very sophisticated and increasingly automated warehousing system.”(Rawat, n.d) This report will specifically describe the management decision-making problems and market research problems faced by Amazon. Through secondary research, the market research problems are subdivided into three problems, and the corresponding solutions are provided by collecting information. Amazon Jia Background 3

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Many consumers choose to buy products on Amazon because they can enjoy faster shipping service and ample supply. But the warehouse needs abundant human resources and strict management, the operation details of the staff are to ensure that the inventory is sufficient and correct indispensable important link. Warehouse management needs to be improved. Management Decision Problem (MDP) ： Amazon's warehouse management involves large-scale logistics, inventory, and order processing operations that require a series of management decisions to ensure efficient warehouse operations and customer satisfaction. Market Research Problem (MRP) ： A good digital warehouse management system is especially important for Amazon, as it ensures that the warehouse is completed in the fastest way possible. Therefore, the market research problem of this report is : how to upgrade the warehouse management system. Amazon Jia The following are several elements of the questions from the secondary study: 4

 How to reduce the impact of too much or too little inventory?  Are employees satisfied with the warehouse management system?  How to adapt to changing customer needs? Approach Warehouse managers need to predict the amount of inventory to make the warehouse inventory fluctuate in a reasonable range, which requires the combination of current trends and past databases. The application of secondary research will capture the trend of the Internet, combined with existing data statistics and product forecasting, to replenish inventory in time and to prevent excessive hoarding. According to surveys, Amazon warehouse employees are unsatisfied with their jobs. “Technology has enabled employers to enforce a work pace with no room for inefficiency, squeezing every ounce of downtime out of workers' days. "(2019, Guendelsberger) Employees perform work tasks under intense pressure, which will have long-term negative effects, leading to less hiring and even affecting Amazon's reputation. Anonymous employee surveys are necessary to improve satisfaction. Amazon Jia 5

Collecting user feedback helps to meet the changing customer needs. User feedback not only affects the fluctuation of inventory, but also can improve consumer satisfaction. Take user evaluation as an important index to improve product satisfaction, increase customer service times, and improve response efficiency. Conclusion In short, by setting the Management Decision Problem as improving the efficiency of warehouse management and user satisfaction, and then setting a series of problem factors through secondary research, the basic solution can be found, which can improve the positive impact of warehouse management on Amazon. Amazon Jia 6

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Reference Rawat, A. S. (n.d.). How does Amazon use Warehouse Technologies? . Analytics Steps. https://www.analyticssteps.com/blogs/how-does-amazon-use-warehouse- technologies Guendelsberger, E., & On the Clock: What Low-Wage Work Did to Me and How It Drives America Insane. (2019, July 18). Amazon treats its warehouse workers like robots: Ex-employee . Time. https://time.com/5629233/amazon-warehouse- employee-treatment-robots/ 7

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