Strategic Analysis of Amazon

Info: 7704 words (31 pages) Dissertation
Published: 27th Sep 2021

Reference this

Tagged: BusinessBusiness Strategy

Share this: Facebook Twitter Reddit LinkedIn WhatsApp

Introduction and Background on Organization……………………………………………………………………………2

Executive summary…………………………………………………………………………………………………………………….3

Strategic Analysis……………………………………………………………………………………………………………………….4

External Analysis…………………………………………………………………………………………………………….4

Internal Analysis…………………………………………………………………………………………………………….7

SWOT Analysis……………………………………………………………………………………………………………….9

Strategic Formulation……………………………………………………………………………………………………………….10

Vision Statement………………………………………………………………………………………………….10

Mission Statement……………………………………………………………………………………………….11

Strategic Issues…………………………………………………………………………………………………….11

Business Level Strategy…………………………………………………………………………………………11

Corporate Level Strategy………………………………………………………………………………………12

Strategic Implementation………………………………………………………………………………………………………….14

Action Plans………………………………………………………………………………………………………………….14

Implementation of the Action Plans……………………………………………………………………………..14

Performance Metrics……………………………………………………………………………………………………15

Conclusion………………………………………………………………………………………………………………………………..16

References………………………………………………………………………………………………………………………………..16

Introduction and Background on Organization

The company Amazon has revolutionized itself within a period of two decades since 1994, the year in which company was founded. In the earlier days, the company’s operations were carried out in the garage of the CEO Jeff Bezos. Started with just selling books and later converting it into world’s largest online shopping place was not an easy task. In the beginning days, the company executives used to place order for a book online themselves whenever an order comes, get it delivered to their office, repackage it and then ship it to their customer. The company’s logo shows an arrow from A to Z, which means the company, is ready to offer anything to anyone, anywhere in the world.

The Company’s CEO and founder Jeff Bezos vision of taking their company to new heights in the e-commerce market environment and for which he formulated various kinds of business strategies which helped them in achieving their goals. The business of the company keeps on flourishing year by year and at present Amazon is offering more than 500 million products online. The company’s user interactive website is easy to use and has played a very important role in grabbing the attention of the customers. Most of the Company’s revenues are generated by selling of the products and services online but the company is also successful in generating huge revenues through their Amazon Web Services (AWS) and Netflix services as these home products of the company captured a large amount of consumer market globally.

To have a strong product line, the company has decided to ease the burden of the packaging and to automate the delivery process for which the company has purchased a fleet of more than 20,000 robots in 2012 for $775 million dollars from an automation provider Kiva system to proceed with the order fulfillment process. In 2013, the company purchased The Washington Post for $250 million dollars which is a popular newspaper of the States.

At present the company ranked third by the Fortune World’s most admired companies. By offering more than 562,382,292 products till date the company is looking forward for many more successful years of business by offering the world class customer service to its customers and their esteemed efforts in making successful their upcoming business strategy which is focused entirely on the usage of drones to complete the delivery of the products.

Executive Summary

Amazon is one of the leading brands in online retail stores which offers more than 500 million products. The company was started from a garage and is now taken to heights where the company is ranked at 3^rd in Forbes. Since, the company is at it’s peak, so certainly there will be some huddles in the way. During the journey of Amazon, there were some internal and external analysis which were analysed so that there should not be any disruption in the growth of the company. To explain external analysis, we have used PEST Analysis and Porter’s Five Forces with which we can measure the external risk factors and by using right strategies after making the action plan, any risk can be overcome. For internal analysis, we have used Value Chain Analysis, which will help us in getting the information about the company’s internal risks which can hamper the growth of the company.

After this, SWOT analysis of the company has been done to recognize the strengths, weakness, opportunity, and threats which can impact the growth of the company. These are the contents which are basically the conclusion of the Internal and External analysis of the company. Moreover, if the problem is identified, the company can reduce the risk by following right strategies.

Later, strategic formulations are discussed in which we have analysed the vision and mission statement of the firm using SMART for goal setting. We have concluded that the firm has good vision and mission statement which gives us the idea of how precise it is referring to the customers and its target market. Then, we will discuss about the strategic issues and their solution i.e. how the issues can be taken care of. Adding on to this, Business Level Strategies and Corporate Level Strategies are shared which will give a brief about the strategies used by them while conducting the business and running a corporation.

Moreover, in the last section of the document, we will discuss about the action plans of Corporate Level Strategies and how they are implemented to achieve their goals. In short, the company started from a garage and is now one of the leading brands in the world and is diversified in every field of retailers. In short, as of now the company is experiencing an impressive growth rate. We believe that the company will be experiencing a growth of 15% if the company invests in other products which will enhance the customers experience and should invest in warehouses where the land is cheap.

Overall, we have observed that the company’s growth is at the rapid pace and since it is investing more in technology and automation, it is expecting that in the coming 3 years, the company will break all the records.

Strategic Analysis

External Analysis

Since Amazon is a global company, there are certain external factors which affects the business of the company. To overcome some of the expected or unexpected issues, PEST analysis is followed. In this analysis, each category will be explained with some relevant examples.

PEST Analysis

There are some factors which are outside the control of the company, but they still can be measured necessary strategies can be followed to reduce the risk on the growth of the company. Here are some of those:

Political:

Political issues include the factors which are related to the government. Here are some factors which can have pros and cons on the company.

Efforts in improving cyber-security is an opportunity as the company will also focus on maintaining a network which is secured, and this will build the trust among the customers for sharing their details like credit card information and address etc. (2)

Tax exemptions for setting up the business to create more employment opportunities is an opportunity as the company will have to pay less taxes like in USA the e-commerce websites don’t have to pay taxes if they don’t have a physical presence and it is a threat as there is a probability that more companies will try to explore their business in states. (2)

Political disruption can lead to supply chain interruption resulting in drop in sales is a threat and weakness as due to any type of political issues or civil war, the business can be hampered.

The development of the company going international can hamper its growth as internet laws does not match with the policies of Amazon which restricts them in expanding worldwide which is a threat for the company.

Economic:

Increasing buying power of the developing countries is an opportunity as the countries are in urge of exploring new products which gives Amazon a chance to grow. (2)

Amazon is trying to create opportunities in e-grocery just like Walmart, this is going to be a threat for the organization as the company like Walmart is already establishes in the product line of grocery and this will lead to drop in share price of Amazon.

Currency fluctuations can be a threat as this can impact the economic conditions of different countries. For example: the prices shown are in USD and converted to different currency at the time of purchase will be different from the time of delivery. If the rate increases, this is a loss to Amazon else the customer will pay extra for the same product.

Sociocultural:

Increasing consumerism in developing countries is an opportunity as the buying power of the customers is increasing after the disposable income. (2)

Increasing online buying habits by the millennials is an opportunity as they are not being lazy, they just want to get their work done with ease and a threat as they will be exploring more websites which will lead to comparison of the price. (2)

Convenience offered only by the e-retail stores to the customers is an opportunity as an individual can access the website or application from anywhere.

Availability of high speed internet and improving technology has attracted many customers which is an opportunity for the organization. This is an achievement for the company as when internet was boosting its market, Amazon was also emerging resulting is success of both internet and Amazon. (3)

Technological:

Technological undesirability is increasing is a threat as the company must constantly improve their IT department resulting, outdated servers can’t be used to manage the load of the website and an opportunity as they will be having a secured network for their website which will build trust among the customers. (2)

Information Technology proficiency is increasing making the platform of the application as user-friendly is an opportunity as if the application or website is easy to understand and access, more customers will attract towards it. (2)

Increasing cybercrime is a threat for the company as if it is not having a secured network, this can lead to hacking of the data of the customers. (2)

Investment in technology at regular interval is a threat as the company must focus on technology also, implies the time will be shared from customers to technology and an opportunity as they will be able to build a network which is safe to access. (3)

Automation has increased the efficiency of the business is an opportunity as with the help of forklifts and robots, work efficiency can be improved.

Amazon Prime Air is an opportunity as they are working on artificial intelligence to deliver the products at the doorsteps of the customers with the help of drones. (4)

Porter’s Five Forces Model of Industry Competition

The threats of new entrants (Low): The reason behind this is that, Amazon is already a global wide organization which has the USD $177.9 Billion in the year 2017. For a new entrant, first it should have strong customer base, economically should be strong so that they can go international and has the capability to compete with Amazon. That is why, we have considered this as a weak thread. (5)

The bargaining power of buyers (High): The bargaining power of customers mean that, how easy it is for the customers to switch to alternatives. For example: We believe that it is easy for the customers of Amazon to switch to a company like Walmart as they provide wide variety of products. To maintain the strong customer base, Amazon must focus on high quality of information provided to the customers so that they can make their decision wisely. (6)

The bargaining power of suppliers (Medium): The idea behind keeping this force as medium is that, there are small number of suppliers available whereas the control over the company by them is minimum. (6)

The threat of substitute products and services (High): Since the switching cost for the customers is very low as there are wide variety of cheap products available in the market which are not sold by Amazon to maintain their brand image can be a huge thread for them. (6)

The intensity of the rivalry among competitors in an industry (High): After observing the market strategies of Amazon and other retail store, we have concluded that Amazon is daily competing with other companies either online or brick-and-mortar companies. For example: companies like Walmart, they also provide same quality of products like Amazon and have variety of products. That is why we believe that the switching cost for the customer is low as there are a lot of options and since the cybercrime is increasing, it is very easy for the company to lose their reputation just by losing customer’s data. (6)

Conclusion: After reviewing the external analysis of the company, it can be depicted that the company is following a growth and they are taking care of the specified rules and regulations which the government has enforced so that their business in other countries is not hampered. Also, they are implementing strategies so that no one can replace them.

Internal Analysis

Jeff Bezos has done an extraordinary job so far in the upbringing of the Amazon company starting from just a garage and turning it into multi million-dollar company by providing world class customer service and by maintaining the originality of the products. (7)

Management – The management of the company including Jeff regulates the company standards very minutely, analyzing the current market scenario and making key decisions based on that, makes Amazon separate from the other ecommerce companies. (7)

Interactive Website – Amazon provides the most interactive website to its customers and its customers find it very easy while placing orders as all the products are aligned according to their respective categories due to which customers overall enjoy a user-friendly experience. (7)

Impressive Infrastructure – In the year 2015, Amazon has purchased a fleet of more than 40,000 robots, thus creating an automated packing process which lowers of the risk of product damage and superior packaging of the products.

Business Size: Since they have been expanding through out the globe, they are improving their trust with the customers by providing them products worth the cost. (7)

Reputation: Amazon has been successful in maintaining their reputation by providing them risk free and reliable deliveries. Also, they have maintained the privacy of the customer’s data like, address, credit cards information and wish carts. (7)

Current price of a stock of Amazon has marked the height of USD 1680+. This implies that the company is emerging at a very fast pace. (8)

Value Chain Analysis

Primary Activities

Inbound Logistics: Amazon uses JIT (just in time inventory) to fulfill the needs of the customers. Also, they have warehouses at different locations which improves the delivery of the products.
Operations: The process of increasing the productivity from transforming inputs to the final stage are know as operations. The method adapted by Amazon is agile. This is because Amazon is a 24/7 company and customers can face any difficulty at any spot of time. To overcome that, the company’s labour and its customer support centers are flexible.

Outbound Logistics: The process of collecting, storing and distributing the product to the customer is called outbound logistics. The process followed by the Amazon Prime is that they guarantee the delivery in 2 days which is much less than Amazon’s original delivery time.

Marketing and Sales: The firms efforts are used to control the 4 P’s which is Price, Product, Promotion and Place. These are the crucial parameters which the company must decide to improve the revenues.

Services: Amazon is a firm which is a customer-centric company, and to be that they must give services to the customers which are unforgettable. This is a great opportunity for the firm as if the customers are getting attention and they are being treated nicely, they will opt for the services of Amazon which will be a growth opportunity for them.

Support Activities

General Administration (Firm Infrastructure): The infrastructure of the company is leading the world as it provides with best of the quality products and services provided to the customers.

Human Resource Management: The firm has a leading management as it is spread across the world. The company always hires potential employees who can think out of the box to increase the productivity of the company.

Technology: The company is enhancing its IT department so that the company can build a website which is most reliable of all the existing e-commerce websites.

Procurement: This is a function in which the firm purchases the products which are used as inputs to recognise the firm’s value chain. This can be described as the inputs like the products that the customer is ordering to get it delivered and till the time of delivery, every risk is taken care of with proper strategies.

Key Resources

Tangible: The storage units, warehouses, distribution centers and its employees are the tangible key resources for Amazon.

Intangible: The reputation of the company with the best services provided to the customers is the intangible key resources.

Organizational Capabilities: Providing user-friendly view for the company’s website with the help of IT systems is the key resource for Amazon.

Key Competitive Advantages

Direct

The factors which directly adds a growth in the company are called Direct Key Competitive advantages. There are some of those:

Logistics: The company has invested in their warehouses around the world and they are focusing more on robotics and automations. These are the direct competitive advantages of the firm as they are giving positive response to the delivery of the products. (9)

Diversification: Since the company is expanding in all the fields of the retail industry, this is giving adding a growth to the company and this adds a competitive feature to the firm. (9)

Brand: As we all know that the company is 3^rd largest company in the world and is ruling the worlds online retail store. The brand itself is adds a competitive feature for the firm against any other organization. (9)

Indirect

There are some factors which indirectly adds the competitive advantages to the firm and these are as follows:

Culture: The culture of the organization is dependant on the employees representing Amazon as they are the face of the organization to the customers. If they are adding value to the customers, the customers will have a valuable experience. This gives a competitive advantage to the firm. (9)

Prime: Prime is a new product launched by Amazon which guarantees the delivery within 24-48 hours. This indirectly adds value to the firm. (9)

Conclusion: After reviewing the internal analysis of the company, we have concluded that the firm is taking good care of their employees and adding a positive value to it. Also, the firm has the capabilities to withstand among the other companies as they are giving a high quality of services to the customers.

SWOT Analysis

SWOT is defined as Strength, Weakness, Opportunities and Threats to the organization. This is a very good tool for analysing the current situation of the organization and by using this information the company can plan its future. Here are some of details about each factor of it:

Strength:

The Application: Due to the emerging technology, Amazon has been able to make their mobile application with best security features to maintain the privacy and securing the data of the customers.

The company has established a strong customer base with widest range of products with the lowest prices offered on a variety of products.

Weakness:

The biggest weakness that the company is having is they have outsourced their distribution and delivery to third party for the delivery of some of the products. This implies, the dependency of the company is on third party companies, which is a great thread for their reputation. For example: If the company claims that the product will be delivered next day but due to the delay by distribution company, Amazon will be risking its reputation and cost.

Opportunity:

The biggest opportunity for Amazon is the developing countries like India as they are improving their economic conditions which give Amazon to boost their business. The laws for importing will be beneficial for the company and the opportunities in terms of customer will be more as they are trying to adapt western culture.

The high-speed internet available: As we all know that, in today’s world we have high speed internet which is a growth for Amazon as they are getting customers who can access their website easily while sitting anywhere.

With the advancement of the technology, the customers can have a user-friendly application and website for shopping.

The labour in developing countries is cheap so they can open their own or outsource their warehouses in India so that they can emerge their business in India and the neighbouring countries.

Threats:

Since the new entrants are not a big thread for Amazon, but the biggest thread can be the customers and the third-party distributors as the cost of switching is low and they can easily switch to other alternatives. Like, in India Flipkart the new emerging e-commerce giant has gained a lot of popularity and can be a great challenge for Amazon.

Conclusion: After reviewing the SWOT analysis of the firm, we have concluded that the company has strengths which include the management which runs the company is profit oriented and they believe in taking risks and following the strategies to make the weakness and threats as their opportunities to grow.

Strategic Formulation

Vision Statement: “To be Earth’s most customer-centric company, where customers can find and discover anything they might want to buy online.” The vision statement depicts that the company always prioritize its customers who wants to purchase anything while sitting at home and wants their products to be delivered right at their door steps with widest range of variety with making the company international. The company had the target market as Earth which implies that the company has the vision to reach every corner of the world to deliver best quality products and providing world class service to their customers at there door steps. (10)
Mission Statement: “We strive to offer our customers the lowest possible prices, the best available selection, and the utmost convenience.”
The word customer defines the company’s target market is Earth providing them with the widest range of products with lowest price. The utmost convenience describes as the customers must use the internet from placing the order till the order is delivered successfully. We as a group believe that the mission statement of the company is describing about their major stakeholder which is customers. Moreover, the company wants to provide the best products to them with affordable prices.

As per the vision statement and mission statement, we as a group believe that these statements are Specific as this refers to customers, Relevant as this refers to buying the products online and Attainable as their target market is Earth, which makes this statement good for the organization. (10)

Strategic Issues: (18) The issues that the company might can face in the coming years related to strategies or in the business are as follows:

The company should find new area for the expansion of the business and the solution for this is to expand their business in the sophisticated areas which are less connected with the world. For example, Denmark and Sweden will be a new target market for Amazon to increase their income.

The other major issue that the company is facing is there are a lot of third party sellers are joining the company’s website. This is good for the customers as they get their products at cheap prices whereas, the major con is that the customers sometimes compromise on the quality of the product, which leads to bad image of Amazon. The company should conduct a quality assurance check which will prove that the products shown on the website are authentic and the customers won’t be compromising on the quality.

In PEST analysis, there are some external factors which can be good or bad for the company like high speed internet, which is an opportunity for the company as this will give chance to Amazon to expand globally. The other factor is government policies which are different for all the countries. In this, the company should take into consideration that they have to make plans as per the policies of the government of the company.

Business Level Strategy: Amazon is following the Cost Leadership strategy at the business level as the company focus on wide range of products that are available at low prices. The profit of the company is calculated on the number of products sold as the margin for e-retailers is like razor thin which implies the margins on a single product is very less. So, if more the number of products is sold, more the income of the company would be. However, we believe that the company can also try to implement differentiation, as this strategy also has broad scope in terms of products. The company should understand the needs of the customer and starts to focus on premium products. since, there are some premium products available on the website, but we are discussing here about the products which are liked by customers. For example: customers like to read books from kindle, they should launch a product of premium quality which will give them the opportunity to have their own premium products.

Adding to this, it has been observed that the company is focusing mainly on three strategies which are: Cost Leadership, Differentiation and Focus. Based on the requirement in any of the situations, the company uses the combination of these strategies to get up to a resolution. (11)

Corporate Level Strategy: The company has mainly three main customers: Consumers, Sellers and Developers. All of them are important in the growth of Amazon, this implies that these three are the pillars of the Amazon. The strategy that company follows is Customer Satisfaction which implies that the company’s priority is to make the customers happy by providing them best services.

The company’s focus is to provide customers with low price products with best in class service and products. To give some more details on this, below are the strategic goals and associated strategic objectives with the help of Ansoff Matrix to determine the growth options for Amazon.

Ansoff Matrix		Products
Ansoff Matrix		Existing	New
Markets	Existing	Alliance with other websites or e-retailers. (pets.com, fabric.com, etc.)	New product line: New products have been launched by the company like Kindle, Kindle Fire etc. with new and improved capabilities and expectations of the customers.
Markets	New	Market Development Amazon has tried to enter new zones, cities, territories and countries like India. They have other plans also for the expansion in different countries.	Diversification They are trying to make new products which will enhance the customer experience like Amazon Web Services, Netflix etc.

(11)

The individual strategic goals and its objective is described below.

Strategy	Strategic Goal	Strategic Objective
Alliance	To merge, take over or have tie ups with other leading regional websites which are leading in any field. Like, pets.com is a leading e-retail store for the products consumed by pets like dogs, cats etc.	The objective here was to build a strong relationship with other retail stores of different countries so that Amazon can start their base in new locations.
Product Development	To improve the capabilities of bookstore by giving beyond current expectations to the customers who like to read.	They wanted to launch a product which will enhance the customer experience in reading, as they started their business with online book store. Hence, they launched Kindle for this.
Market Development	To expand the business in new countries and territories.	To make the company a global firm which will provide the best quality products at low prices across the world.
Diversification	To launch new products with enhanced capabilities.	They wanted to enhance themselves in new field of technology and with the help of AWS, Netflix etc. their objective was to spread in all the fields.

(11)

As per the analysis done by Ansoff Matrix, out of the 4 strategies, Amazon has acquired all the 4 strategies. They have been working hard to make their company be one of the leading brands of e-retailer. They had alliance with the existing e-retailers like pet.com, fabric.com etc. to boost their business. Also, they have launched they own product named as Kindle. Since, they started as online book store, this was a great achievement for them as the customers liked the product as it is affordable and easy to carry. Moreover, they have been successful in market development strategy as they were able to globalise the company. Also, they have their warehouses in India and it is one of the leading online brands there and competes with Flipkart which is the India’s largest online retail store. Adding on to this, the firm has successfully enhanced the customers experience with launching new and diversified products like AWS, Netflix etc. these are all cloud-based products.

On the corporate level, the company has been following diversification strategy as the firm first started with an online bookstore and now it is one of the leading e-commerce websites. Since, they have worked on all the strategies and now they are spread in all the fields so that they can enhance the customer experience. (11)

Conclusion: The vision and mission statement of the firm is giving a precise idea about the company is customer-centric firm. Moreover, after all the strategies been followed by the firm, it has been concluded that the firm is having a diversified range of products which means they have followed all the four strategies which are explained in the Ansoff Metrics.

Strategic Implementation

Action Plans

Alliance: The word alliance means merging or having a tie up with another organization. In the case of Amazon, the action plan for making the alliance with other companies were:

They targeted the regional online retail stores which were growing at a rapid pace. The idea behind this was, they wanted to merge their business with other organizations. The reason was, they will start with the small companies and then later they will have their business expanded. That was their plan for it.

Product Development: Since they started as a first online bookstore, they wanted to enhance the experience of there customers by focusing on a new product. They planned and concluded that, they will make a product which will be pocket friendly, affordable and environmental friendly. This was their plan for launching a new product.

Market Development: The company was started from USA and they had a lot of name in their country. So, now there was the time they had to think of expansion. For the expansion of their website, they had to understand the policies of the government, needs of the market, they targeted India in the year 2012. They planned for the understanding of the policies of the government, what the customers needs are and spread a wave of online shopping in India as it is one of the emerging countries in the globe as its purchasing power was increasing.

Diversification: Being one of the leading brands for an online retail store across the globe, they also wanted to expand themselves in the field of technology. They wanted to create a product which would be new in the market and will enhance the experience of the customers in the terms of data privacy. They planned for a new product which would provide on-demand cloud computing support as paid subscription. Also, they wanted to enhance the experience of the entertainment industry.

Implementation

Alliance: They implemented their plan by merging with small online retail stores which were selling specific products like, pets.com which deals in selling the products consumed by pets like dogs, cats etc.

Product Development: After making the plan, when they were in the implementing phase, they launched a new product which is known as Kindle. This was first launched in 2007 and the response from the customers who like reading was amazing. After the launch of this product in the month of November 2007, within six hours, they were sold out till the month of April 2008. The total of approximately 200 books were preloaded in the kindle and rest you could buy. This was a successful implementation of launching a new product specific for the readers.

Market Development: In February 2012, a website named Junglee.com was launched in India. This was the product of Amazon; whose motive was to see the response of the Indian market. By using the database of Junglee’s website, in the year 2017, Amazon closed the Junglee.com and redirected to Amazon India. After the implementation of there plan to expand in India, in the year 2017 Amazon invested a total of US$300 million in India to maintain the strong customer base by providing them with more variety of products.

Diversification: Since, Amazon is becoming one of the leading online retail stores, they wanted to expand their business in the field of entertainment and security. So, after the planning and discussion, they came up with a new product which were Amazon Web Services (AWS) and Netflix. AWS is the cloud-based product which provides the services for on-demand cloud computing platforms. This is a platform for creating virtual computers using the virtual consoles. The other product is Netflix, which is a paid subscription for the entertainment. In this, an individual can pay to get the subscription of the movies, TV series etc. Overall, both these products have added a huge amount of income for Amazon.

Performance Metrics

To ensure that the all the three customers i.e. consumers, sellers and developers; are getting expected services that are promised to them by Amazon, they have created several performance metrics which will depict the information if the customers are satisfied or not.

There are seven performance metrics which Amazon’s sellers monitor of the users to have a good account standing.

Cancellation Rate: This is the rate at which an individual customer cancels the order. The Amazon has set the bench mark which should be less than 2.5%. If the account maintains this percentage, this is considered as a good account.

Contact Response Time: The response time is the time in which the customer must respond to the message sent by the seller. The average response time which has been set by Amazon is less than 24 hours. If the time exceeds by this limit, the account is rated as poor. (12)

Customer Service Dissatisfaction Rate: Once the product has been delivered to the customer, Amazon tries to keep the percentage below to 25% which implies that the support center of the company, contacts the customer to get the causes of the complaint. The percentage is calculated as number of “No” votes given by the customer divide by the total number of responses given to the seller whenever they receive the message from the sellers. (13)

Late Shipment Rate: Once the order is placed by the customer, they can view the status of their shipment. The rate is calculated as the total number of times the shipment is delayed as per the expected delivery time divided by the total number of times the shipment is delivered within the expected time. Amazon has set this to be at less than 4% which is considered as good account. (14)

Order Defect Rate: If a customer receives an order which is having any imperfections that is known as defect. The rate is calculated as number of times a defected product is delivered divide by the total number of orders delivered. Amazon provides 30 days of time from the day of delivery if there are any manufacturing defects in the product. (15)

Return Dissatisfaction Rate: The target set by the company is less than 10% for an account. However, there are three components on which this rate is measured for customer satisfaction. Those three components are: Negative return feedback rate, Late response rate and Invalid rejection rate. These are the components which are considered for an individual account for the calculation of above rate. (16)

Valid Tracking Rate: Once the order has been placed by the customer, the customer expects to see the status of the product’s delivery. To make sure that the company is giving accurate information, the company has set the rate at more than 95% which means that, if you are able to view the details of delivery, that information is 95% accurate. (17)

Conclusion of the Strategic Plan: It has been clearly observed that the company is growing at a rapid pace and it is expected to growth more in the coming 3 years. The reason for that is because they have followed all the strategies suggested by Ansoff Metrics like, Alliances, Product Development, Market Development and Diversification. After this, the internal and external analysis of the company depicts that the company is following the strategies to overcome any risks which may impact the growth of the firm.