SCM

 At Amazon, SCM encompasses the planning, execution, and optimisation of every stage in the product flow - from vendors and manufacturers to Fulfilment Centres (FCs), cross-docks (IXDs/rIXDs), and ultimately to end customers.
Effective supply chain management balances demand forecasting, inventory placement, transportation efficiency, and cost control, supporting Amazon’s customer promise of speed and reliability.

Core Components of Amazon SCM:

1. Planning & Forecasting:
   • Predicting customer demand using machine learning models.
   • Aligning purchase orders (POs) and replenishment schedules.
   • Coordinating with vendors through Planned Replenishment (PR) or VIO/VIAO systems.
2. Procurement & Inbound Logistics:
   • Managing vendor shipments via Vendor Central (VC).
   • Using SCAC and VRID identifiers for freight routing.
   • Leveraging inbound hubs like IXD (Inbound Cross Dock) or rIXD (Regional Inbound Cross Dock) for consolidation.
3. Inventory & Storage Management:
   • Optimising inventory levels using metrics like WOC (Weeks of Cover) and VLT (Vendor Lead Time).
   • Minimising overstock or Zero Inventories while preventing OOS (Out-of-Stock).
   • Balancing regional placement to meet Prime delivery speeds.
4. Fulfilment & Distribution:
   • Coordinating between Fulfilment Centres (FCs), Sort Centres (SCs), and Delivery Stations (DSs).
   • Leveraging programmes like Vendor Flex (VF) and Direct Fulfilment (DF).
5. Transportation & Last Mile:
   • Managing multi-modal logistics - air, sea, rail, and truck.
   • Using Amazon Transportation Services (ATS) and AMZL (Amazon Logistics) networks for delivery optimisation.
6. Reverse Logistics:
   • Handling returns, refurbishments, and Warehouse Deals to reduce waste and recover value.

Benefits for Amazon:

• Operational excellence: Drives fast and predictable delivery (Prime standard).
• Cost efficiency: Reduces storage and transportation expenses through predictive modelling.
• Network scalability: Enables dynamic routing and capacity expansion.
• Customer satisfaction: Ensures consistent availability and on-time delivery.

Benefits for Vendors:

• Visibility: Transparent tracking of inbound and replenishment operations.
• Stability: Reliable forecasting and demand signals from Amazon.
• Efficiency: Reduced dwell times and improved sell-through rates.

Challenges:

• Complexity: Global operations require continuous system coordination.
• Data dependency: Inaccurate forecasts can lead to overstock or lost sales.
• Disruption management: Weather events, port congestion, or strikes can impact fulfilment.

Why It Matters:
SCM is at the heart of Amazon’s “Customer Obsession” - ensuring that every order arrives accurately, quickly, and at the lowest possible cost.
Through advanced technology, automation, and data analytics, Amazon has turned SCM into one of its core competitive advantages.

Example:
An electronics vendor sends stock to an rIXD hub in Germany under Amazon’s Planned Replenishment model.
From there, Amazon’s SCM algorithms distribute inventory across European FCs to match forecasted demand - ensuring next-day delivery for Prime customers.

In short:
SCM (Supply Chain Management) is the integrated process of planning, sourcing, storing, and delivering products - ensuring efficiency, availability, and speed across Amazon’s global fulfilment network.