Stake Holder Analysis
Amazon's top management from the start has made it clear that the clients are their main priority and anything that hinders and detracts their growth towards satisfying their clients will not be considered or won’t be even given as much importance. Therefore, the stakeholders that actually matters the most to Jeff Bezos and Amazon are its only clients. They believe that customers are the peoples who have the money and our competitors are never going to pay us money for our products or services. Customer centric, customer focused and customer driven are only limited terms among the many which actually represents the real value for the company. Introducing the EDN would for sure ad the value to the exceptional vision of the company.
To accommodate and satisfy the smaller customer segments they can setup marketing and sales offices for special countries by taking the stakeholders in confidence. Here they can construct particular websites and archives catering to national and international demand. Desired title scan, and then be sourced from the nearby DC. While Amazon is at present live in the EU markets of Germany, France and Great Britain, they should consider expanding to a wider targeted audience by introducing the perception of a ‘marketplace’.”‘ Marketplace’ is defined as a cluster of different countries with a sole catalog and served by a sole DC.” The current DC in France could also expand into a bunch containing Belgium, France and Luxembourg. Germany could turn out to be a cluster that actually contains Austria, Switzerland and Germany itself. The British installation could include all of Ireland and Great Britain. In adding together the above mentioned clusters and by taking suggestion from key employees Amazon company can further introduce several DCs for additional bunches with Italy catering to Southeast European territories like Greece, Hungary and Bulgaria. Poland catering to the Ukraine, Czech Republic & Belarus and Sweden running the Scandinavian countries like Finland, Norway and etc. Thus all-encompassing the whole European Union. Setting up Amazon.com as a focus on point for third-party marketing activities involving a variety of private dealers, would also be a suggestion worth considering. It will actually facilitate third-party sellers to present their goods alongside Amazon’s offerings. These will consequence in increased viewership of the site as well results in enhanced customer data base. These all implementations needs to be made by making sure that core elements like top management, employees, customers and society might not consider it trouble maker.
Therefore, to encounter the stakeholder’s expectations, Amazon actually may make low price per item, but by regularly earning trust, they will sell many more items easily. Therefore, Amazon offers relatively low prices across their entire product category.
External Analysis
Porter’s five forces for analyzing overall situation
Porter Five Forces Model distinguishes and inspects five competitive forces that shape out the likely pros and cons for every industry, and support to find out an industry's overall attractiveness by means of different forces that are influencing the different factors which are there in the industry.
Ø Threat of new entrants is high
The threat of new entrant is high because it is less costly to enter into such industry in which you need to have relatively stable capital but with exceptional branding and distribution expertise. Competitors like eBay and Wal-Mart makes it difficult for the one to enter into this industry across the globe. Although many brands have been introduced in the market time to time and they all have been wiped out by the companies Amazon and eBay, but still this industry possesses immense potential for new entrants.
Ø The bargaining power of buyers is high
The bargaining power of buyer in this industry is high because they have approximately same competitors available in the form of eBay and Wal-Mart as a replacement for each other. They both possess exactly the same operational excellence and can be easily taken as a replacement of each other. If Amazon raises the prices so it is a possibility that a customer might go to Wal-Mart. Therefore, worldwide price wars actually go on a regular basis between the competitors to gain the market share.
Ø The bargaining power of suppliers is low
The bargaining power of supplier is low because a supplier of brand name like Amazon cannot afford to bargain a lot, because if it loses a contract so it might be a huge loss for that supplier. For example, if Amazon is supplying books by a certain publisher so that suppliers would try his level best to maintain excellent relationships with them and must not negotiate un-necessary. In this industry the excellent relationships with each other matters a lot which is kept good from all perspectives. So these publishers...................................
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