SUPPLY CHAIN STRATEGY
Amazon maintains its supply chain edge with a Vendor Managed Inventory( VMI) model that gives suppliers real-time insight into warehouse stock levels and sales performance. Instead of waiting for Amazon to raise purchase orders, suppliers take the lead, restocking when products hit predetermined thresholds. This hands-off approach on Amazon’ s part clears the way for smoother, leaner operations.
With millions of SKUs( stock keeping units) moving through its system, Amazon removes layers of admin by scrapping the need for manual purchase orders.
Suppliers track demand and replenish in sync with actual sales data, cutting down instances of stockouts and surplus inventory – meaning faster deliveries and fewer disappointed customers.
“ Today, in virtually every corner of the company, we’ re using generative AI to make customers’ lives better and easier,” explained CEO Andy Jassy earlier this year.“ In our fulfillment network, we’ re using AI to improve inventory placement, demand forecasting and the efficiency of our robots – all of which have improved cost to serve and delivery speed.”
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