Online retailing giant, Amazon continues with the trend of buying goods from multiple retailers so as to keep its store loaded. This is actualized through the company’s ‘Fulfilled by Amazon’ program. According to the report made available on CNBC, the project managers have communicated (via e-mail) the objectives of the scheme, with several retailers across the United States of America.
The program will see to it that customers’ items are kept and shipped to them at the specified time without the customer- or even the retailer having to pay any extra fee. Amazon hopes that other customers who are currently not in the scheme, will embrace the offer, and thus become a part of its growing list of loyal customers.
Furthermore, as the company’s spokesperson stated, the scheme is centered on having fast moving consumers’ goods readily available in its store- especially in areas where the products that meet customers’ demands are either in short supply or unavailable. Hence, at the initial stage, the scheme cannot be said to be one that is directed towards generating more revenues. Rather, it is an avenue that would help Amazon maintain its competitive edge in the market for the future.
Looking at the ‘Fulfilled by Amazon’ scheme from a different angle, it seems to be Amazon’s way of responding to manufacturers’ refusal to sell items on its portal. In this case, the retailing giant has taken upon itself to reach out to retailers in order to obtain such items through third party agreement.
However, online footwear retailing store, Birkenstock has moved to block doing transactions with Amazon on both ends- directly or through its (Birkenstock’) retailers. The reason for such stringent measure may not be unconnected to the fact that Birkenstock believes entering such agreement could end up being ‘unfavorable’ for its company’s growth.
It is obvious to see that Amazon sees the ‘Fulfilled by’ scheme as a credible way of expanding its business globally. But it’s still not clear how effective or workable this kind of program would be in the long run.
By SounderBruce (Own work) [CC BY-SA 4.0], via Wikimedia Commons