Amazon and what an amazing Inventory tactic. VIDEO clip attached.

Amazon and what it is one of the most innovative inventory techniques.


Amazon is such a huge global online store. It started as a bookstore, yet today you practically can buy anything. One of the main reasons why Amazon has become so successful is because of their inventory tactics and fast delivery. They have partnered up with UPS which brings out a great example of a business to business model.

In class, we focused on two questions that ties down to inventory:

1. How much to order?
2. When to order?

In addition, we discussed 4 types of inventory:

1.Raw Materials
4.Finished goods

Amazon strictly deals with finished goods. What makes them so successful is the way the business operates. Many people would not think of amazon as an assembly line, in fact, it sort of it. The way it works is that an order is being placed. One person would tag the box with the order, the second would go around the warehouse and packaged the order goods, 3rd would label the box and drop it off at the shipping station.

In addition, many of amazon products are at your home. Customers have the option of selling their books and more through amazon. This way, amazon acts as the middle man. You are solely responsible for shipping your good. Amazon will charge you a small fee for using them as the selling vendor.  Because of the way Amazon does business, they are extremely efficient when it comes to inventory related costs. Correct me if I am wrong, but one of the only costs that Amazon may be concerned about for some items are Holding or Carrying costs. Some of the products will never sell. Will Amazon just drop the price of the product or completely destroy it because the carrying costs exceed the projected revenue?

Many of you may not know, however, Amazon was the inventor of the “Shopping Cart.” What a great invention that almost every online vendor took advantage of.

Lastly, I believe that Amazon sparked the popularity of online shopping. Because of the world wide shipping, convince and such a wide variety of product and low prices, there is no reason for you to leave your house to order your favorite book or DVD. Amazon actually, is one of Wal-Mart’s main competitors. I think that one day, the popularity of online shopping will exceed the need for BestBuy and Wal-Mart. It’s only the matter of time.

Innovation is Phenomenal! Bicycle of the 21st Century

Do you remember your first bicycle?
Part of growing up, one of the most exciting things that many of us have experienced was learning how to ride a bike. Most of us can recall the first bicycle they had, maybe most of you still have it.

The first bicycle was invented in Germany in 1816. The bicycle had no chain and the wheels were huge. It only had one gear, but that was not the point. It was an innovation that many of us love to use today. <—
History of the first bicycle

One of the first things when buying a bike is asking how many gears will it have so I could see how hard do I have to paddle up the hill and how fast can I go down the hill. This has finally been answered by Novara Gotham.

Recently in class we have been discussing product life cycle. Now for years each bicycle would have gears or no gears. Based on my experience from working at a bike shop, many customers want the bike to have as much as gears as possible. This way they can go faster and easier up the hills. Will this innovation change the future production of bicycles?

How can this new innovation be applied to the product life cycle?

  • -Research
  • -Product Development
  • -Process modification and enhancement
  • -Supplier development

First bike have been invented over 200 years ago, technically this is a new innovation within an old one. In addition, this a brand new addition of a bicycle brand to the family of bikes. Do you think Trek or Felt might want to buy this concept to increase their innovation ideas?

This new product opportunity must have went through an extensive product development.

  1. Ideas
  2. Ability
  3. Customer 
  4. Requirements
  5. Functional
  6. Specifications
  7. Product 
  8. Specifications
  9. Design 
  10. Review
  11. Test 
  12. Market
  13. Introduction
  14. Evaluation

My question is how does one think of an innovation like this from the beginning? Is it mostly the customers’ requests and the first one out there to figure it out is the one to put it together. Not many people in the business world have the opportunity to have their innovative idea make it to the market. It takes a lot of knowledge and networks to establish themselves.

Many innovative individuals might have the ability to design a concept but how do you manufacture it? The QFD plays an essential role in this project. It was a team of innovators that worked together in order to have a solid plan before proposing it to anyone.

In my opinion, one of the first people to purchase this bike will be employees of huge cycling companies. That way they can take it apart and figure out the engineering portion of this innovation.

Do you think that reverse engineering should be illegal? Its almost as if someone was stealing a patent from you.