Innovative Way Of Serving Customers From Amazon.com Inc. (NASDAQ:AMZN)
In what analyst believe is precursor to emerging business and distribution model; Wall Street Journal has reported that online retailer Amazon.com Inc. (NASDAQ:AMZN) has started embedding its own employees in the warehouses of Procter & Gamble which are spread across the length and breadth of North America. The Amazon.com Inc. (NASDAQ:AMZN) employees working out of these warehouses are equipped to process online orders for Procter and Gamble’s consumer consumable items like shampoo and tooth pastes coming into the retailer’s e-commerce portal.
In what seems to be a under the wraps arrangement, Amazon.com Inc. (NASDAQ:AMZN) is experimenting with this model of distribution to get a leg up on its competition in terms of quicker turn around on processing orders and reducing the time taken to deliver the products to customers. The Wall Street report goes on to add that Amazon’s arrangement with P&G can be traced back to almost three years. The model has been deemed to be successful since the arrangement of having its employees working out of P&G warehouses has now been expanded to 7 distribution centres in markets like Japan and Germany. This arrangement seems to be a win-win situation since P&G online sales are also bound to be positively impacted. The business news paper quotes insiders having indicated that the online retainer is actively pursuing such arrangements with other large companies and with varying degrees of success.
On being given an opportunity to comment on the WSJ story, P&G’s global supply management head has been quoted to have replied that “P&G values its relationships with all its customers” and effectively collaborates with many retailers including Amazon to help them reduce costs and reduce the delivery time to customers.
It will be interesting to note how other global retailers respond to this model being pioneered by Amazon which has seen seamless integration between distribution channels and product manufacturing companies.