Amazon announces Supply Chain by Amazon – This morning Amazon announced the expansion of its logistics network, allowing its selling partners to move their products in bulk from Amazon’s low-cost storage service, Amazon Warehousing Distribution (AWD), to any sales channel, including physical stores and warehouses, rather than just directly to consumers’ doorsteps.
According to Amazon, the new Multi-Channel Distribution (MCD) solution will allow sellers to replenish all of their sales and fulfillment channels from a single inventory pool, simplifying supply chain management and allowing for cost savings on incoming shipments.
In order to build their business, sellers can also leverage Amazon’s investment in its distribution network and technology to maintain the correct inventory levels across all of their sales channels, including online and physical store locations.
MCD is presently in a limited testing program with a select group of Amazon merchants, but it is slated to reach all Amazon sellers later at some point this year.
The new service was one of several announcements made by Amazon during its Amazon Accelerate conference in Seattle this week. Supply Chain by Amazon, an end-to-end, fully automated set of supply chain services that will provide sellers with solutions to move their products from manufacturing locations to customers worldwide while benefiting from Amazon’s logistics, warehousing, distribution, fulfillment, and transportation capabilities, was introduced here.
The solution builds on the gains made with Fulfillment by Amazon (FBA) in 2006, which allows Amazon to pick, pack, and ship sellers’ products at quicker speeds and with greater dependability — and for 70% less than rival fulfillment services, according to Amazon. FBA has resulted in Amazon today delivering about 300 million unique products to its consumers with rapid, free shipping.
However, while FBA focuses on fulfillment, the new services being launched begin earlier in the product journey, with manufacture. Amazon can now pick up goods from manufacturing facilities all across the world, ship it across borders, handle customs clearance and ground transportation, store inventory in bulk, and manage replenishment across Amazon and sellers’ other channels.
As part of its Amazon Global Logistics (AGL) offering, Amazon is expanding its origin services closer to sellers’ facilities to provide extra pick-up services for all of its ocean freight at major manufacturing centers. This comprises services such as origin services, maritime freight shipment, customs clearance, and others.
Furthermore, sellers will be able to use Amazon’s Partnered Carrier Program (PCP) later this year to speed domestic shipping into AWD centers. Furthermore, Amazon is eliminating peak pricing for AWD in the fourth quarter so that sellers can manage their inventory levels more efficiently even during the busy Christmas season.
FBA will also provide automatic inventory replenishment, which will use Amazon’s machine learning and supply chain optimization skills to transfer inventory to the best Amazon fulfillment facilities and off-Amazon channels via the new Multi-Channel Fulfillment (MCF).
“Our vision has always been to make it as easy as possible for sellers to serve customers around the world, and providing our selling partners with a simple, fast, cost-effective solution to a challenge that has become increasingly unpredictable and complex is an important investment in sellers’ success,” said Dharmesh Mehta, Amazon vice president of Worldwide Selling Partner Services.
“With Supply Chain by Amazon, Amazon will pick up sellers’ inventory directly from their factory, and manage the supply chain logistics through delivery to customers’ doorsteps. Sellers will be able to offload even more of the complexity of their supply chain logistics to Amazon, both for the products they sell in Amazon’s store and through other sales channels including online and physical store locations. We are excited to help sellers, both on and off Amazon, save more money, drive more business growth, and have more time to continue inventing amazing products for customers,” he added.