Inventory Management of Amazon and Ford Motors Companies

Inventory Management
Student’s Name
Course Title:
Instructor's Name:
Date:
Inventory Management
Inventory management is the process of ordering, handling, storing, and using a company’s non-capitalized assets. For some businesses, inventory management involves raw materials and components, while others may only deal with finished stock items ready for sale. This term paper attempts to describe and explain how the Amazon and Ford Motors Companies manage inventory to achieve carry out their business. Amazon is a company whose headquarters are in Seattle, Washington. Jeff Bezos founded it in 1994 to provide E-commerce services (online retailing). Ford Motor Company is found in Dearborn, Michigan, an automotive corporation that was founded in 1903 by Henry Ford and 11 associate investors (Tahir, 2020). These companies have put in place inventory management to ensure their products and services are produced in the right way to achieve their missions and visions.
Types and roles of Inventories managed by Amazon and Ford Motors Companies
For a company to succeed and achieve its intended goals, it must engage itself and employ good working inventories. Amazon makes it easier for everybody with access to the internet to buy even a massive range of products at any time and get them delivered wherever they want from anywhere in the world. Their book inventory management is based on the number of sales for each book. Best-selling books are stocked in many regional warehouses to enable fast responsiveness for customers in any region. Books with a smaller number of sales are stocked in only a few regional warehouses to reduce inventory costs (Dmitry & Tsipoulanidis, 2017). The slowest-moving books are not even held in stock but are obtained directly from the publisher or distributor. Through this strategy, it is possible for Amazon to reduce inventory costs for slow-moving products and to have the best possible service level and reliability for their customers.
Multi-channel inventory management is another strategy that Amazon Company has used to ensure its products and services reach more people worldwide. The company provides free software called Veeqo that syncs and tracks inventory across channels, locations, and FBA. When you sell on one channel, Veeqo ensures your inventory levels are reduced across all your channels, preventing overselling. When sellers choose FBA, they automatically gain access to Amazon's machine learning-based inventory management system. This system uses inputs like the cost of goods sold, shipment time, and Amazon data to forecast customer demand and set optimum inventory levels (Amazon, 2018). This will enable the consumers to identify and look at the goods and services before purchasing.
Ford Motors Company’s timely acquisition of capital makes it more financially sound to procure the required materials on time and meet the market demand CITATION Ste14 \l 1033 (Stefan & Burritt, 2014). There is enough capital to run the business without facing any financial constraints. Reduction in the number of suppliers has also helped the company make a better relationship with the suppliers, leading to the on-time supply of the required inventories. When the number of suppliers is few, it is easy to manage and impose changes when necessary. The company's limited production network also reduces its competitive advantage compared to its competitor, Toyota, which has an expansive global network for procurement and inventory management.
Goods and Service Design
Service design offers in-depth insight into customers' needs and motivations, making them want to use specific services. Good goods and service design of a company increases the number of customers and enables the company to achieve its intended purpose. For example, Amazon Company provides an interactive search system (Imran, 2014). The search system allows the customer to go through the services he needs as often as he wants anytime from anywhere provided an internet connection. The company also has Customer Relation Management (CRM) which ensures the customer is satisfied. This also makes the customer gain more loyalty to the company. Customers are free to interact with the company and comment about its services through customer feedback, customer interest, wish lists, and product reviews web page (Imran, 2014). Customer acquisition and retention have been the most priority of Amazon's strategy. Through the website, Amazon maintains sophisticated communication that automates the process of creating customer value.
On the other hand, Ford Motors Company has made significant progress in customer satisfaction levels by regional aspect, especially in Europe and Asia-Pacific regions (Tahir, 2020). Ford has focused on improving quality in infotainment, transmissions, and interiors. Customer satisfaction is also trending up because of the well-organized Global Product Development System that fosters substantial improvements in more efficient vehicle launches, fewer downstream changes, and improved timing (David, 2015). Through the improvement of quality, there are more customers, and through this increase, it is a clear indication that the customers are satisfied with their services.
Types and Importance of Layouts Found in the companies
The four basic layouts include; product layout, process layout, combination layout, and fixed layout. These layouts vary depending on the type of services a particular company offers. Product layout is when all the processing equipment and machinery are positioned according to the product's sequence of operations. The main focus of product layout is the sequence of operations regarding the production or assembly needed for a product or some of its parts manufacturing and assembling. Product layout is advantageous for sectors that produce in large quantities or continuously, such as automobile assembling, cement manufacturing, and oil refining. Ford Motors Company uses product layout in its production, unlike the Amazon Company. Process layout means the layout that groups resources based on similar processes or functions. A process layout is used in contexts where many different items are produced in small quantities. Because so many different items are produced with distinct processing requirements, it is not viable to allocate an entire facility to each item. In Ford ...