Business strategy of amazon

1. A Presentation on Business Strategy of
BY
TIRTHANKAR SUTRADHAR

2. Introduction
Amazon’s Indian subsidiary Amazon Wholesale India launched its pilot project in Bengaluru in
April.
Replication of AmazonSupply model, which is a similar B2B platform for American SMBs and
traders.
Dedicated 30,000 sq ft warehouse in the Bommasandra industrial area of Bengaluru.
Receives products directly from manufacturers and ships them to customers within two days after
an order is placed online.
Maintains a separate centre for its B2C business at Hoskote on the outskirts of Bengaluru.

3. Problems looking to address
“Small and medium businesses suffered because of inefficiencies in
the supplies procurement system. Either the fill rates were poor, or
the pricing was not transparent, or the delivery options were
inconvenient and vendor lead time was huge.”
- Amit Agarwal
Country head
Amazon India

4. Features of AmazonBusiness.in
A members-only B2B website.
Targeted audience: Small offices, entrepreneurs, department stores, kirana stores, drugstores,
clinics, hospitals, hotels, and restaurants.
Invite only mode: Not open for all. Business owners and traders need to request an invite to be
able to procure goods from this market place.
Minimum order which can be placed is Rs 1000.
Amazon will try to provision credit facility after collaborating with a financial firm,
Valid business license required to be eligible for becoming a member

5. Porter’s five forces
analysis

6. Competitor
Rivalry
Threat of
new entry
Buyer Power
Threat of
Substitution
Supplier
Power

7. Competitor
Rivalry
Threat of
new entry
Buyer Power
Threat of
Substitution
Supplier
Power
Supplier Power
• Many Suppliers in the
Indian Market
• Over 10,000 products
from more than 100
Indian manufacturers

8. Competitor
Rivalry
Threat of
new entry
Buyer
Power
Threat of
Substitution
Supplier
Power
Buyer Power
• 46 Million SMEs in India
• High degree of buyer
power

9. Competitor
Rivalry
Threat of
new entry
Buyer Power
Threat of
Substitution
Supplier
Power
Competitive
Rivalry
• Few competitors.
• Bestwholesaleprice.co.in
• Over the period of time,
players like Alibaba and
Tata will respond
dynamically.

10. Competitor
Rivalry
Threat of
new entry
Buyer Power
Threat of
Substitution
Supplier
Power
Threat of
Substitution
• Low threat of
substitution as of now.

11. Competitor
Rivalry
Threat of
new entry
Buyer Power
Threat of
Substitution
Supplier
Power
Threat of New
Entry
• Low Threat
• Expertise of Amazon and
their network is tough to
replicate.

12. SMEs in India and their potential
Potential of $56 billion revenue and create 1.1 million new jobs, if internet and latest IT tools are
adopted.
According to the government data, micro, small and medium enterprises employ about 59.7
million persons spread over 26.1 million enterprises.
In value terms, MSMEs accounts for about 45% of the manufacturing output and around 40% of
the total export of the country.
About 90% of small and medium enterprises (SMEs) in India have no access to the Internet.
Nearly 90% of SMEs in India have no access to the Internet, compared with only 22% of SMEs in
China and 5% of SMEs in the US.
At 48 million, India has the second largest number of SMEs in the world. China leads with 50
million.

13. Statewise SME spread in India

14. Strategies
Phase 1: Online B2B distribution in Metros. Awareness in Rural Areas. (6 months)
Phase 2: Online B2B distribution in Metros and Semi Urban cities. (6 months)
Phase 3: Online B2B distribution in Metros, Semi Urban cities and rural areas.