Global Strategy and Sustainability Assignment Sample

1. Introduction

  • Amazon is an online retail company that has expanded its business globally by implementing a customer-centric business model.
  • Amazon has been selling a large number of product varieties such as electronics, grocery items, online retail as well as digital content (Majed et al. 2018).

Amazon has successfully expanded its business to a global platform for online retailing. In modern days, most of the customers prefer online purchasing as most of them are working. Recently, Amazon has launched its new product called Amazon Prime and Amazon Kindle. Amazon Prime has around 150 million users around the globe and it is a subscription based product.

  • The current revenue of Amazon is 280 Billion US Dollars and its global market share is 14% (Hahn et al. 2018).
  • Amazon website has nearly 213 million visitors only in the US and the average yearly spending of Amazon Prime subscribers is 1400 US Dollars (ZALEWSKA-TURZYŃSKA, 2019).
  • The net income of Amazon in 2019 is 11.59 Billion US Dollars and the net sales of Amazon are 280.5 Billion US Dollars (Nicolle and Leroy, 2017).

Apart from these Amazon has developed its products on a regular basis which caused increased customers of Amazon. Amazon has worked on their customer satisfaction and for that, they have developed their product delivery process.

2. External environment of Amazon

  • Political: The stability in Government rules and regulations has created a business-friendly atmosphere in the UK that has helped Amazon to develop its business in the UK (Majed et al. 2018).
  • Economic: The GDP of the UK was 2.744 trillion US Dollars which helped Amazon to successfully run its business in the UK (Nicolle and Leroy, 2017).

The UK has the most powerful administrative system in the world which has helped Amazon to expand their business in the UK. Moreover, the diverse economy of the UK countries, direct investment from the foreign countries, and currently reduced tax rate (18%) has helped Amazon to successfully flourish their business.

  • Social: In terms of a huge consumer market, the health care system, and income level the UK has provided Amazon with a business-friendly environment (Hahn et al. 2018).
  • Technological: The UK has a huge number of technology organizations that have been helpful for Amazon to develop its business on a digital platform (Majed et al. 2018).

Other social factors include the increasing population of the UK that can help Amazon to get more workers for their business. The health insurance companies of the UK have developed so much that Amazon has secured its business and employees under their insurance policies. Therefore, it has helped Amazon to expand their business in the UK without any problem. On the other hand, a proper education system in the UK has helped Amazon to recruit more deserving employees. Therefore, the business process of Amazon has been securely sustained for the future.

  • Legal: The Employment Act 1996 in the UK is customized in such a way that has provided Amazon all the facilities that it needs to expand its business (Leite et al. 2020).
  • Environmental: Amazon has focused on its business on recycling its products and reduces plastic waste along with producing eco-friendly products and services (Herbrich, 2017).

It can be said that Amazon’s great initiative of producing eco-friendly products and therefore the UK government has allowed Amazon to expand their business there. Moreover, the pleasant weather of the UK countries attracts a huge number of tourists. As a result, Amazon got its popularity all over the world which increased its customer number. On the other hand, The Employment Act 1996 has been made in such a way that has given several opportunities to global business organizations (Leite et al. 2020). Therefore, Amazon also got the opportunity to expand their business in the digital platform of various countries in the UK.

3. Internal environment of Amazon

Strengths

  • Amazon has adopted a low-cost structure along with a large variety in its products which has developed its business really fast (Herbrich, 2017).
  • Amazon does not produce a variety of products, they deliver the products of other sellers which minimized the chance of their product expiring.

Amazon has continued its product development process and therefore they have recently introduced Alexa that is made with Artificial Intelligence. Moreover, Amazon has introduced Amazon Prime and Amazon Kindle that have a large number of users and it has helped Amazon to increase its profit.

Weakness

  • The business model of Amazon can be easily copied by other companies as Amazon sells the products of third-parties which are its weakness (Hahn et al. 2018).
  • The limited penetration of Amazon in progressive markets is its weakness that restricts the business from earning more profit from the market’s high economic growth rates.

Amazon has been doing its digital business from the beginning as a delivery partner. However, recently Amazon has decided to expand its business in the offline market also. Therefore, this decision of Amazon has created a chance of product expiry or product damage which is another weakness of Amazon.

Opportunity

  • Amazon has recently moved to offline business therefore, it can start its brick-and-mortar business for more profit.
  • Amazon has an opportunity to expand its business in the various developing markets in order to earn more profit (Cheung et al. 2017).
  • Amazon can attempt for new partnerships with other organizations in the growing business market.

Apart from these, Amazon can try to add more features to its Amazon Prime product as the product has provided them with more profits in recent years.

Threat

  • Amazon has several strong competitors like Flipkart, Snapdeal, etc. who have generated many business challenges for Amazon (Cavallo, 2018).
  • Amazon generates its entire business through the digital platform and if it gets attacked by unethical hackers then it can be a fatal incident for them.

Amazon has imitated their business model as well as its products. Therefore, it can be a real threat to Amazon. Amazon Prime has a substitute such as Netflix which is equally prioritized by the users. Therefore, Netflix has reduced the users for Amazon Prime to some extent which is a threat to Amazon.

References

Cavallo, A., 2018. More Amazon effects: online competition and pricing behaviors (No. w25138). National Bureau of Economic Research.

Cheung, J.H., Burns, D.K., Sinclair, R.R. and Sliter, M., 2017. Amazon Mechanical Turk in organizational psychology: An evaluation and practical recommendations. Journal of Business and Psychology32(4), pp.347-361.

Hahn, Y., Kim, D. and Youn, M.K., 2018. A Brief Analysis of Amazon and Distribution Strategy. The Journal of Distribution Science16(4), pp.17-20.

Herbrich, R., 2017, February. Machine Learning at Amazon. In WSDM (p. 535).

Leite, L., Kon, F., Pinto, G. and Meirelles, P., 2020, June. Platform teams: An organizational structure for continuous delivery. In Proceedings of the IEEE/ACM 42nd International Conference on Software Engineering Workshops (pp. 505-511).

Majed, S.Z., Nuraddin, S.H. and Hama, S.V.S., 2018. Analyzing the amazon success strategies. Journal of process management. New Technologies6(4), pp.65-69.

Nicolle, S. and Leroy, M., 2017. Advocacy coalitions and protected areas creation process: case study in the Amazon. Journal of Environmental Management198, pp.99-109.

ZALEWSKA-TURZYŃSKA, M., 2019. IMPACT OF CLOUD COMPUTING INNOVATIONS TO MANUFACTURING COMPANIES ON ORGANIZATION STRUCTURE SPECIALIZATION AND HIERARCHY OF AUTHORITY. In THE 9th INTERNATIONAL CONFERENCE ON MANAGEMENT (p. 149).

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