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4 Lessons on Supply Chain Management from Amazon

Date: Fri, Jan 29th, 2016 12:00:00 am

Amazon.com has a business model that many small entrepreneurs would like to emulate. Through excellent supply chain management, Amazon went from a start-up operating out of a garage to a multi-billion dollar behemoth. It might seem simplistic to suggest that Jeff Bezos and Amazon owe it all to excellent supply chain management, but through that single factor, Amazon is able to deliver great customer service, innovation and outstanding products. Here are lessons any business owner can take away from Amazon's supply chain management.

Lessons Small Businesses Can Take Away From Amazon's Success

1. The customer is always first.

When Bezos gathers the team for a meeting, he symbolically leaves one chair empty. Everyone understands that the chair signifies the customer who should be considered in every decision. Without customers, a business has no reason to exist. Better supply chain management means greater customer satisfaction. Delivering high quality products on time is one of the best ways to make a one-time shopper a customer for life.

2. Crunch the numbers.

Good supply chain management nearly always requires transparency. This means you understand every link in the chain. To do so, it's necessary to keep track of statistics. That way, executives know what's working and can drop anything that's not performing up to speed. Quality supply chain management means having intimate knowledge of how processes are flowing at all times.

3. Have contingency plans.

Jeff Bezos doesn't just believe in having a plan B if things aren't going optimally. He'll also figure out plans c, d and e as a "just in case." This way, he doesn't waste time wondering what to do when something goes wrong. He's already got more than one backup strategy.

4. Be aware of competitors.

Amazon doesn't make knowing what the competition is doing a priority. Still, the company likes to keep an eye on what others are doing, they just don't let it interfere with their plans and innovations. Keep an ear to the ground, but blaze a unique trail.

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