Amazon has launched its fully-managed, end-to-end Supply Chain by Amazon service, a complete solution designed to simplify seller operations, lower costs, and get products from factories to customers more quickly and efficiently. The service is driving an average of 20% higher sales conversion, transforming the supply chain landscape.
Sellers can now leverage Amazon’s advanced logistics, warehousing, distribution, fulfilment, and transportation to move products faster, reducing shipping times and saving both time and money. Hundreds of thousands of sellers already use at least one of the Supply Chain by Amazon services, with adoption of multiple services tripling in the first half of 2024. With this launch, sellers have a fully managed option where Amazon provides forecasting and optimisation and manages the flow of goods across the supply chain.
The impact of using Supply Chain by Amazon has been transformative for sellers like Steve Neufer, co-founder of Juvo+, which creates high-quality products that improve people’s everyday lives. “Having Amazon partner with us on our end-to-end supply chain has been a game changer that’s great for our business,” Neufer said. “The speed and reliability of its logistics services have enabled us to keep our products in stock with less working capital while delighting customers with lightning-fast deliveries. Customers react strongly to being able to get a product same day or next day, and we see our sales conversion roughly double.”
Amazon is rapidly scaling global logistics to enable worldwide product movement from manufacturing hubs, across borders, through customs, and into destination countries.
In August, Amazon moved over 20,000 containers globally. For domestic logistics, sellers can book transportation at up to 25% lower costs compared to alternatives.
Domestic logistics services are now available in 19 countries. In the U.S., sellers have used Amazon’s domestic logistics services to send 2 billion product units into its fulfilment network since last year.
Amazon Warehousing and Distribution (AWD) offers sellers a solution to store products in bulk and replenish them quickly to fulfilment centres and physical stores. Amazon is enhancing AWD by connecting it with more fulfilment centres and transportation lanes to accelerate U.S. product delivery. To meet growing demand, Amazon is quadrupling AWD capacity in the U.S. in 2024.
A key feature of AWD is the new Multi-Channel Distribution (MCD), which allows sellers to distribute products in bulk across their sales channels using a unified inventory pool. This feature reduces the need for sellers to allocate inventory to each channel individually, minimising the risks of excess stock or missed sales. On average, sellers find that consolidating inventory into a single AWD pool reduces total stock needs by 20%, resulting in significant capital savings. MCD also offers custom labelling, enabling sellers to distribute products in bulk to various sales channels.
The fully-managed Supply Chain by Amazon solution makes the supply chain more turnkey than ever before. Available to all U.S. sellers for domestic pickups in October and global pickups by year-end, the fully-managed option lets sellers choose which services to use and either manage product movement themselves or have Amazon automate the process. Sellers simply provide product details and pickup locations, while Amazon oversees the rest. Sellers using this option qualify for AWD integrated rates, including a 25% discount on AWD storage fees and a 15% reduction in AWD transportation and processing costs.
“Becoming an expert in supply chain is not how sellers win,” said Neufer. “We win by making better products and delivering for the customer. Amazon is an expert in supply chain. Instead of shouldering every aspect of inventory, logistics, and customs, Amazon is a great partner for businesses of all sizes because they help take that on for us. This frees up time and energy to focus on elevating brands, understanding customer needs, and building great products; that’s how sellers really win.”
To learn more about Supply Chain by Amazon, visit Amazon’s Supply Chain programme page: sell.amazon.com/programs/supply-chain
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