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Essay / Amazon's Methodology and Marketplace - 816
What has made Amazon a unique competitor in the retail market is its methodology. Amazon has grown to include many different aspects of the marketplace and many of its products are delivered digitally, eliminating the need for physical shipping. When the company first started, it opened two distribution centers strategically located on both coasts of the United States, one in Seattle and the other in Delaware. In 1999, the company opened more centers in the United States and began expanding into the international market with the opening of distribution centers in Germany and the United Kingdom. In 2012, the company operated 89 distribution centers in North America, Europe and Asia. The company experienced some setbacks after reporting multimillion-dollar losses around the turn of the century. This caused the retail mogul to restructure some of his facilities in order to run his business more efficiently. One of the attributes of Amazon's distribution strategy is that the location of its fulfillment centers does not exactly match that of the general population. Amazon has had issues with states like Texas over tax procedures in the past, which is reflected in the location of its fulfillment centers. They have fewer centers in more populous states, like Texas, California, and New York, to avoid harassment through state tax laws. Using this to its advantage, Amazon has expanded into states that offer tax incentives in exchange for creating jobs within their state. However, this company knows when it's time to shift gears. Today, as most states implement online tax legislation, Amazon has realized that the days of tax-free shopping are coming to an end. The company already has b...... middle of paper ......site. This is great for the company because in these circumstances they are only acting as a store and once the sale is complete they are no longer responsible for getting the product to the consumer. Amazon's unique logistics strategies have allowed the company to experience incredible growth since the beginning. of the company in 1995. The company has been very careful in creating and placing distribution centers in order to increase the profitability of the company. As the company continues to expand around the world and into previously unexplored market niches, it will continue to implement the same logistics strategies that have been so successful in the past. While many companies around the world use the Amazon model in their own businesses, it is evident that Amazon's strategy is effective and capable of growing with the ever-changing culture of running an online marketplace...