(TIỂU LUẬN) several difficulties have arisen for amazon during the COVID 19 epidemic since limitations have harmed and interrupted company operations

Examining the logistics and supply chain management of an Amazon in Vietnam will be thegoal of this research.. The supply chain channel map initially reveals the supplychain features and

ASSIGNMENT COVER PAGE

The location where you study Saigon South Campus

Student name and student e-mail address Le Phung Hoang Minh - s3759204

Nguyen Pham Phuong Nhi - s3758282Nguyen Duong Minh Hieu - s3878647Hoang Dang Duong - s3881724Nguyen Phu Cuong - s3879078

Le Nguyen Ha Thi - s3878453

Learning facilitator in charge Ms.Hang, Nguyen Thu

Number of pages including this one 29

Examining the logistics and supply chain management of an Amazon in Vietnam will be thegoal of this research Specifically, this report will illustrate Vinamilk which is one of thethird-party sellers of Amazon The supply chain channel map initially reveals the supplychain features and procedures, and then three key flows, including product, financial, andinformation, are also displayed in the first part Aside from that, the four major operations insupply chain management, which include procurement, packaging, transportation, andwarehousing, are clearly outlined based on theories and Amazon's system structure andperformance criteria.

Next, discussion A will be examined in the following report Particularly, discussion Afocuses on Amazon's supply chain core competencies, as well as the benefits and difficulties

of implementing a push system, and the impact of a good buyer-supplier relationship on acompany's supply chain The function of technology in today's modern period has also beenemphasized, along with its numerous advantages As a result, RFID and robotics plays animportant role in improving Amazon supply chain management

Several difficulties have arisen for Amazon during the COVID-19 epidemic since limitationshave harmed and interrupted company operations Firstly, the demand volatility should bementioned because customers’ demand will be affected during the Covid-19 pandemic due toseveral factors such as income, price However, the competitive number of stocks which ismaintained in warehouses in order to stimulate customers’ demand will be the solution forthis problem The interruption of the supply chain under the COVID-19 is another problemdue to the reduction of the number of transportations In this situation, decentralization ofdistribution can help Amazon solve the problem Production stoppages is the final problem

which is mentioned in this report The regulation changes and the training course for theworkers should occur to improve the quality of the workforce in the future

Table of Content

I Introduction… ……….……… … ………… 6

II Identify supply chain aspect……… …… …… 6

a) Supply channel map description……… … ……… … 6

1 Upstream……… ……….……… 8

2 Downstream……… ……….……… 8

b) Supply chain actor description……… ……… ……….……8

1 Production flow……….……….………….… 8

2 Information flow……….……….…… 9

3 Financial flow……….….…….…… 9

c) Major supply chain activities……… ………

… 9

1 Procurement……….….…….…….9

2 Warehousing……… ……….… 10

3 Packaging……….…….….………

… 11

4 Transportation……….……….………….12

III Discussion a) Discussion A……….…….……… 13

1 Core competence of the chain……….……….….…………

13 2 Supply Chain network characteristics……… ………

14 3 Relationship in supply chain……….…

……… 15

4 Technology……… ……….16

b) Discussion B……….………….……… 17

1 Demand volatility……… ……… ………….18

2 Production stoppages……… ………….…… ………… 19

3 Transportation disruption……… ………… ………….20

IV Conclusion………… ………….……… ….20

V Summary of teamwork……….

……… 21

VI References………… ……….22

I Introduction

Amazon Vietnam is a part of Amazon organization based in the United States which is one ofthe giants in the cloud computing e-commerce artificial intelligence consumer electronicsIndustry Amazon wants to be the most customer-focused firm on the planet Their aim is toconstantly improve the customer experience by utilizing the internet and technology to assistcustomers in finding, discovering, and purchasing anything, as well as to enable companiesand content producers to maximize their success (Amazon n.d) Additionally, when buyerspurchase products sold and delivered by a third-party vendor, they are protected by the A-to-zGuarantee It addresses both the timeliness of delivery and the quality of your products Inaddition, Amazon also contains approximately 10 million sellers and 20 websites around theworld Kannan and Tan (2010) felt that if a company can optimize its supply chain, it willhold the key to long-term development As a result, because Amazon has a global distributionnetwork, it is critical for them to enhance their supply chain management

In this study, with Vinamilk as the primary customer, we will analyze Amazon Vietnam'ssupply chain by addressing the three key flows and four important processes in their supplychain Discussion A focuses on the supply chain's competency and various linkages, whereasdiscussion B delves deeper into the present problems that Amazon is facing and makessolutions based on available facts

II Identify - supply chain aspect/ process selected

a) Supply Channel Map Description

Figure 1 Channel Map for Supply Chain about Vinamilk

1 Upstream

The upstream procedures include preparing and storing material processes to control thecapacity of the material, level of inventory, and scheduled delivery (Alkhatib 2017) Based onthe channel map, the raw materials and packages of Vinamilk are being imported fromleading and reputable sources in the world such as the US, New Zealand, the Netherlands, etc

to ensure the best quality products The collecting centers will process materials and qualitycontrol these raw materials and move them to either Ho Chi Minh or Hanoi Warehouse Fromthere, the products are being manufactured in 11 international standard factories and 2 megainternational standard factories After the products are packaged and labeled properly, theproducts will be transported back to the Distribution Centers and ready to be stored/ shipped

2 Downstream

The downstream’s process contains distributors and customers, in which the main functionsare storing and distributing the final goods from the manufacturing to the final consumers(Shkoukani, Alnaghi & Abulayl 2013) After the final products are being transferred to theDistribution Centers, they will be delivered through 5 main channels The first and secondchannels include modern trade to supermarkets and convenience stores, while the otherdistributors include Giac Mo Sua Viet stores, Retailers, and Wholesalers delivery as later-on-shelves for the end consumers The third channel will be distributed to schools andcompanies Another channel is through e-commerce including e-shop and other onlineplatforms such as Tiki, Shopee, and Amazon using outsourced logistic services to deliver todomestic end-users Last but not least, the products are being exported and are handed toforeign customers through fulfillment center services

b) Supply Chain Actor Description

1 Production Flow

Any company's objective is to minimize logistics expenses while maintaining a specific level

of service quality by regulating physical flows in a logistics chain (Hamoudi, Bellaouar &Petiot 2021) To begin, cows are brought from the United States or milk can be purchasedfrom local farms Second, raw ingredients from various nations and regions are delivered toVinamilk's manufacturers in VietNam Vinamilk has a center equipped with sophisticatedmachinery and equipment to assure the highest quality of fresh milk such as cold storage,

uses barcodes, deliver information to households, Automatic cleaning-in-place (CIP)technology, enhanced sanitation to maintain food hygiene and safety, quick cooling tankswith large volumes and great flexibility (Vinamilk 2019) After that, the raw materials areprocessed and manufactured into end goods The finished goods will be delivered towarehouses located in the North and South of Vietnam Other distributors, e-commercefulfillment centers such as Amazon, traditional trade/modern trade warehouses, importantaccounts (school/hospital), and exports outside of the country are next.

2 Information Flow

Utilizing sophisticated information platforms that support effective information exchangeacross supply chain participants and across supply chain stages (Riikka 2009) Vinamilk hasfinally established an automatic method for calculating optimum production rates asforecasting throughout the connected factory chain Moreover, the technology issuesinadequate or maximum storage notifications in order to modify production requirements atmanufacturers as well as inventory levels at distribution With the help of Vinamilk's deliverymanagement software, it is now possible to keep track of shipments in live time as well as see

a breakdown of operational data by vehicle and driver (Vinamilk 2020)

3 Financial Flow

Inventory management, the processing of logistically induced financial flows, and supportingprocedures with an immediate connection to logistics, such as stock insurance management,are examples of logistically driven financial processes (Hans & Moritz 2009) Long-termassets were managed and new investments were made by the company in order to maintainhigh asset management effectiveness and future growth appropriateness while minimizingwaste and asset loss (Vinamilk 2021) Vinamilk must manage its cash flow proactively sinceits cash outflow will be greater than its cash inflow As a result, they must be adaptable inorder to minimize cash flow disruptions, maintain appropriate financial supply, and managefinancial activities

c) Four Major Supply Chain Activities

1 Procurement

Procurement planning, determining qualitative, quantitative, and time-related materialrequirements, and purchasing externally purchased items are the fundamental functions of

procurement in this aspect Other responsibilities include supply source management,searching for suitable suppliers, requesting estimates, evaluating and supervising plannedcontract fulfillment (Jens & Bernd & Matthias 2011) In the Vinamilk procurement processes,there are two sorts of transactions: farmers who contract directly with Vinamilk's processingfacilities to sell their raw milk, and milk collectors who contract with farmers to collect andsell milk to Vinamilk.

Nevertheless, the Vinamilk procurement system's quality testing mechanism is a seriouslimitation Vinamilk employees collect and utilize advanced technology procedures, the dairyfacility randomly selects and analyzes one sample every week Farmers are paid directlydepending on the quality test results (fat, protein, total) (Huong 2015) Producing goods fromraw materials requires a process, from procurement planning to demand identification toreaching suppliers then selecting a selection of possible suppliers These steps are followed

by assessments, negotiations, contract reviews, purchase orders, import shipment, evaluations

of quality, payments and ultimately tracking system

Amazon assists businesses in digitally transforming their procurement activities, which leads

to enhanced business results Amazon is an e-commerce firm offering services, theprocurement operations in the supply chain quite differ from those for the goods The processincludes looking for prospective suppliers, making inquiries with suppliers to obtain pricequotes, request samples for evaluation, contract conditions discussed and negotiated, make apurchase, and deliver the goods to the storage facility Improve profitability, save time,recurring delivery, efficient payment, increase situation awareness, keep track of yourpurchases & procurement data (Procurement Iq)

2 Warehousing

Vinamilk controls the whole operation using an intermediary warehouse managementsoftware (WMS) and the Tetra PlantMasterTM system It is a fully automated system forfinding and removing constraints Tetra Pak is a dairy filling equipment used in asepticmanufacturing It is the quickest packaging option offered and used to boost the productivity

of production lines Vinamilk will be able to reduce several manual activities, which oftenslows the flow of products, therefore they started to use automated warehouse operations Anew generation of LGV robots, compact and quick in operation with minimal energy usage,can be found in Vinamilk's warehouse LGV robots are self-operating and controlled by acentral computer system, allowing the company to save money while also improving

productivity and the quality of its products Vinamilk additionally installed a barcodescanning technology to maximize the productivity of production processes in theirwarehouse, avoiding potential errors and lowering incorrect shipment To accomplish properwarehouse management, Vinamilk constantly strives to offer process improvements to checklevels of inventory and maintain inventory control at the highest efficiency.

Amazon's success is primarily due to its effective storage strategy, which ensures thatproducts are immediately available from practically any location on the planet

Amazon warehouse is equipped with the pick-pack robot in five different storage locations,the organizing approach allows team members and pick-pack robots to grab things rapidlyand move them toward delivery Purchases are made and data is recorded into the inventorymanagement system, which then makes a list of orders based on product quantity Afterdropping the activities followed by picking and packing the activities, finally preparing forsending off (Centobelli et al 2016)

Most of the warehouses are designed with a large capacity, which ensures that they can store

a wide range of products Providing sufficient area for the trucks and robots to function moreeffectively and easy for them to move around the warehouse For improved monitoring,products kept in warehouses are batch-numbered and barcoded, allowing warehousepersonnel to minimize the loss of goods Using signage, ground markings, and labels,workplace dangers and cautions are marked for better safety

3 Packaging

The objective of packaging is to guarantee the safe and timely delivery of goods to the finalcustomer, as well as the effective reuse, recovery, and/or disposal of packaging material at alow cost (Saghir 2001) Amazon has high expectations according to the packagingspecifically, there are 5 requirements

First, to ensure the product is undamaged through the distribution process, the product must

be protected, including transportation to Amazon Fulfillment Center, movement within theAmazon network and Fulfillment Centers, and shipment to the end customer Second,packaging must be sealed and have marking essentials such as barcode, product description,and regulatory markings for distribution and fulfillment Third, the package has to be easy toopen in 120 seconds and is not allowed with shredded paper, sealed clamshells, etc Last butnot least, it is required to be recyclable materials with recycled content statements and must

fit size All packages must follow Amazon’s packaging guidelines and restrictions beforesending products to the fulfillment centers for storage and shipping to the end-users (Amazon2014)

In order to get packages to customers, Amazon divides its fulfillment network into a variety

of building types to bring the product most efficiently In the sortable fulfillment center, byworking along with Amazon Robotics, the staff are able to learn new skills to pick, pack andship orders including books, toys, and housewares Besides, Amazon employees working inthe non-sortable fulfillment center will pick, pack and ship larger-sized items such asfurniture or outdoor equipment From there, customer orders will sort by final destination atthe sortation centers by truck to associate with everyday delivery service from Amazon(Amazon n.d)

4 Transportation

The role of transportation has a major impact on organizations, and is economicallyinfluential on the financial performance of a business According to Tseng, Yue & Taylor(2005), transportation is one-third of the amount of the performance of the logistics system,required from manufacturing to delivery to the end consumers and returns Not only that, asthe steadily rising growth of third-party logistics providers (3PL) integrating corecompetencies in the logistic functions, Amazon also has their 3PL service called Fulfillment

by Amazon (FBA) that provides e-commerce fulfillment for their own customers (Amazonn.d) However, although Vietnamese customers can have access to Amazon.com, variousproducts are not accessible for shipment to Vietnam involving exorbitant shipping costs (Anh

Tu 2019)

Moreover, Vinamilk’s distribution network is highly sophisticated, 3PLs service appliesintermodal transportation to effectively distribute their milk products Intermodaltransportation is the process of transferring cargoes by truck, rail, and ocean shipping to thefinal destination (Crainic & Kim 2005) This is the most cost-efficient way of accessing bylinking mode from pickup to linehaul and delivery provided by railroads service (RMIT2014) Firstly, many raw materials are imported from the US, New Zealand, the Netherlands,etc and transferred to Vinamilk’s warehouse in Ho Chi Minh City and Hanoi by trucksthrough 3PL services from Tan Cang and Phu Thai logistics (Saigon Newport Corporation2015) From there, the final products will be distributed to Giac Mo Sua Viet stores,supermarkets, schools, hospitals, retailers, companies, and e-commerce channels such as Tiki,

Shoppee, or Lazada by trucks However, exported products will be transferred to theimporter’s fulfillment center such as Fulfillment by Amazon, and delivered by ships orairplanes to foreign customers Yet, customer dissatisfaction may occur due to the Covid-19pandemic, and the shipment of goods process might be delayed and struggle

III Discussion

a) Discussion A

1 The core competence of the chain - supply chain objective

In keeping with Dittman (2013), core competencies are the skills and knowledgecombinations of multiple schools such as purchasing, transportation, and warehousing that acompany has gained over time The supply chain's fundamental competency is a dynamicallybalanced system that can maintain present and prospective competitive advantagesthroughout time (Tieman, 2017) Furthermore, the supply chain's key competence is itscapacity to integrate the whole process, particularly in manufacturing, technology transfer,and related management systems, in order to boost company efficiency (McKinnon & Hoberg2017)

Amazon, recognizing this as maximally beneficial, used knowledge of core competencies atthe greatest degree of maturity as a business with significant potential for the supply chainmanagement Because of its continual emphasis on key capabilities such as distribution,logistics, providing platforms and tools for people, and utilizing technology, Amazonconsistently delivers on its objective of being “Earth's most customer-friendly company”(Fredkin 2018) Amazon owns AWS, the world's largest cloud computing technologiesservice, and utilizes it to supply chain management in order to achieve high efficiency andcontinuous growth by incorporating with other 3PLs and using, expanding organizationalfunctions to get the best results (Amazonas 2021) FBA and FBM are Amazon's twofulfillment options for third-party sellers, who account for 55% of all sales on the site Cloudincorporation, in terms of detail and accomplishment, will help speed up the procurementprocess because it will allow you to complete it in minutes In line with Virgo (2018), atAmazon, everything is converted into data to be analyzed In contrast to a logistics firm thatmonitors only indicators that are directly linked to their business, this method allows theorganization to plan and execute on the basis of the "big picture." Big Data insights are