Amazon unveils end-to-end supply chain services

Through Supply Chain by Amazon, sellers can have the company handle their logistics from manufacturers to customers.

Dive Brief:

• Amazon unveiled Tuesday an end-to-end set of supply chain services that’s now available for third-party sellers to use across all sales channels, including outside of Amazon.
• Through “Supply Chain by Amazon,” Amazon can pick up inventory from sellers’ manufacturing facilities, ship across borders, handle customs clearance and ground transportation, store inventory in bulk, provide automatic inventory replenishment and deliver to customers, according to a news release.
• “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,” Dharmesh Mehta, Amazon vice president of Worldwide Selling Partner Services, said in a statement.

Dive Insight:

Amazon built its new set of services to help sellers manage their supply chains upstream of the company’s order fulfillment services — known as Fulfillment by Amazon — said Piyush Saraogi, vice president of Worldwide Fulfillment by Amazon, in an interview.

“If you think about a small business owner, they’re probably contracting with multiple companies to move the products from global manufacturing hubs all the way to distribution centers into [Fulfillment by Amazon],” Saraogi said. “Many times these companies don’t talk to each other. They don’t integrate well.”

Through Supply Chain by Amazon, sellers can have Amazon handle their logistics from manufacturers to customers, rather than dealing with a mix of companies themselves. The offering brings together both new and existing Amazon services.

The capabilities Supply Chain by Amazon offers include:

• Amazon Global Logistics, a service handling cross-border transportation. Starting in October, Amazon will enhance the service by offering pickup from sellers’ manufacturing facilities, Saraogi said. Sellers will still have the option to drop off goods at Amazon locations.
• Amazon Warehousing and Distribution, the company’s long-term inventory storage service that is now open to all sellers.
• Multi-Channel Distribution, which moves product in bulk from Amazon Warehousing and Distribution to any seller channel, be it an online store or a physical location. The service is currently in pilot with a select group of sellers and is slated to be available to all sellers later this year.
• Automatic inventory replenishment into Amazon fulfillment centers. The company will tap into machine learning to move goods into optimal locations for expected demand.

Pricing is based on various factors, including the types of products being shipped as well as the seller’s distribution channels, Saraogi said. Sellers can opt into the services a la carte or select them all for the complete offering.

“The real magic really happens when sellers utilize all of these services and automate the flow of goods end to end,” Saraogi said.