Last spring, Amazon.com decided to end its venture with one of its largest third party sellers, DAB Unlimited. Amazon logs more than two million sellers, where nearly half of all of its merchandise is sold by volume through Amazon.com. Like DAB Unlimited, third party companies use Amazon’s website, warehouses and payment systems to sell their goods over the Web, allowing the retailer to offer a much broader range of products. This type of strategy has caught on to other retailers such a Staples Inc., Wal-Mart Stores Inc., and Sears Holdings Corp.

DAB Unlimited mainly offered vitamins, supplements, weight-loss pills, pet-care products and children’s toys. In 2010, DAB racked in more than $200 million in sales alone. The fast growth of companies like DAB explain how Amazon can generate mass amounts revenue or even increase their revenue by 25% like they did in 2008.

The biggest risk of this venture is that Amazon cannot control the overall customer experience. Between 2009 and 2012, Amazon received dozens of complaints from people claiming that DAB had sold them counterfeit or mislabeled items, according to internal Amazon documents filed from their bankruptcy case. But although Amazon cannot control the full customer experience, Amazon did take matters into their hand in 2011 forcing DAB to stop selling products on their sight after DAB sought bankruptcy protection.

But third party sellers like DAB shows the true risk that Amazon faces when it comes to customer service. One specific customer reported that DAB was selling fake Gillette Mach3 razor cartridges, according to the Amazon documents. However, there are less than 1% of DAB shipments that get flagged for problems.  During one instance where a customer took some diet pills and felt adverse side affects, Amazon took it upon them to investigate and sent a warning to DAB with the concerns. At this point, Amazon, based on recommendations, decided to suspend DAB’s selling privileges. Johnson & Johnson last year suspended sales of scores of consumer products and over-the-counter medications to Amazon because it said the Web retailer wasn’t doing enough to prevent third parties from selling expired or damaged J&J products.

Although the Amazon account manager pleads a blind eye to the situation, he is now willing to help improve third-party sellers in sales and in ratings.  Amazon is still currently not doing business with DAB Unlimited. However, DAB Unlimited still has its storefronts open and has been continuing to get great ratings from customers since 2006. It is still not clear if Amazon will look to do business with DAB in the future.

1. How do you think Amazon.com service is when it comes to returns?
2. Do you believe that third party sellers provide a convenience or a hassle to customers?
3. Should Amazon.com look to develop a new strategy to better manage these third party sellers?

 

http://online.wsj.com/news/articles/SB10001424052702304419104579322282141674084

 

 

Have you noticed in the past few years the new technology in doctors offices? Electronic medical records are sweeping the medical industry. Although this may have seemed like a brilliant plan, it still lacks efficiency.

In the article, “How Electronic Patient Records Can Slow Productivity”, Dina Gerdeman, with the help of Robert S. Huckman’s research, explains how technology in certain types of environments (typically larger practices) can hinder production. Researchers like Mr. Huckman are trying to highlight the key aspects of using electronic health records of (EHRs). Even though there are a considerable amount of benefits of using EHR, there are instances where there are losses in productivity, but those losses can be avoided. The key take away from the implementations of EHR’s is that they have altered the communication between staff members, as well as patients.

One of the best points to take away from this article is “.. when we ask how that technology can improve productivity, we have to consider that the true capability of the system depends on the context in which it is adopted.” This point reminds me most of outsourcing, a fad that has started to die out. Most companies originally believed outsourcing or production, IT and other such components would reduce spending. What some companies soon discovered is that there are certain key parts of their business that cannot afford to be outsourced. This concept now seems to stand true in the medical field.

With EHRs becoming so prominent, it is easy to highlight key strengths and weaknesses. The introduction of the EHRs to the medical field has extensively added to the dehumanization and production in these practices. Staff have become more focused on mastering the technology instead of focusing on the patient. Staff members could easily get frustrated, which now decreases productivity and prevents excellent customer service. Face-to- face meetings have become less critical since information is available at a physician’s fingertips. For larger practices this may be sufficient, but for smaller practices this communication could be vital and is now undermined. However, adopting a new technology that could categorize and allow for the easy access of information could be beneficial process is streamlined correctly to what already exists. EHRs allow for time and cost saving opportunities, quick retrieval of data, less errors and patient portals that allows patients to view reports, lab results and even schedule appointments.

In a world where technology has taken over, relying on a system like EHR will not be detrimental to practices, however, these practices must keep in mind that patients desire an emotional connection. The lack of a physician-to-patient relationship could hinder productivity. It is important to remember, productivity includes both quality and quantity, and without both, losses in productivity are bound to occur.

 

http://hbswk.hbs.edu/item/7452.html#commentform