Managerial Economics and Business Administration (mba630) Student Information Name and Surname: Boburbek Khursanov

Strengths - Entered the online market with a well-thought-out plan. Amazon tested AmazonFresh for 5 years and entered the market with clear plans.
Weaknesses - AmazonFresh is focused more on internal delivery rather than on delivering external orders. This strategy could result in negative consumer feedback and negative Attention.
Opportunities - If AmazonFresh makes its customers aware of its new products through advertising and spreads it more among customers, the company's income and business will increase.
Threats - One of the main threats to the corporation is the changes in federal laws regulating the manufacture of AmazonFresh. The market's competitors react to any clever move very rapidly. New changes in the market may boost the profitability of the firm by requiring a swift change in technology.
One of AmazonFresh's main issues is the extremely low profits in the food sector. "An average grocery shop in 2012 generated around $450,000 in weekly sales, cost $6 million to construct, and was rebuilt every six to seven years at a cost of $3 million," Due to high COGS, labor expenses, and spoilage (MCDONALD&CHRISTENSEN,2014).
“Nearly 40 percent of grocery items (meat, dairy, produce, frozen food) must be maintained at a specific temperature” (MCDONALD&CHRISTENSEN,2014). The control of product temperature and quality requires some investments from AmazonFresh. To make sure that products are delivered within a certain time frame, additional costs are also imposed, such as the costs of buying trucks with freezers. To maintain a consistent temperature and quality of products, AmazonFresh must invest time and money in procuring refrigeration-equipped vehicles and guaranteeing that goods are carried within a specific period of time. Additionally, at the moment AmazonFresh works in Seattle. It must prove its strategy and concept is worthy in other cities before forging ahead with the food industry.
With the AmazonFresh sales model consisting of an online store, customers can choose to ship or pick up at an Amazon store in Seattle. However, AmazonFresh is currently struggling with another major problem. To ensure quality and convenience, some customers prefer to personally select their products from stores.
AmazonFresh is seriously threatened by powerful major markets like Walmart and Safeway, both of which have established their individual online departments. These companies are very famous and have a powerful brand position in the supermarket sector. The second-largest supermarket chain in the country, Safeway, has begun to provide online and local shipping options in addition to in-store order pickup. A similar idea is one that Walmart offers under the name "Walmart to Go.” Those problems can pose a challenge for AmazonFresh to retain customers. Along with food stores, other online food delivery businesses are soon to enter the market. Peapod, an online food delivery business, serves 24 markets with next-day delivery via Stop&Shop and Giant Food stores (MCDONALD&CHRISTENSEN,2014).
There are some recommendations that might be helpful for Amazon to be successful with AmazonFresh in this new market. To start with, AmazonFresh has to create a business plan to broaden its product line, which now includes fresh meat, fruit, and dairy products. We can say that it is challenging to store those items in a plastic container for a long period of time. This issue might be resolved by putting the meat and its packaging in an insulated box that can maintain a cool temperature for some days. By doing this, Amazon would be able to offer its consumers additional options when shopping for food online, in addition to increasing their earnings.
Furthermore, instead of concentrating on a few locations, AmazonFresh can expand its services to all regions. Because of this, they could be missing out on a lot of sales opportunities. Amazon makes the lowest prices possible by leveraging technology (The Business Model of Amazon, 2015). The majority of customers also are heard of Amazon as a low-cost corporation, so providing them the opportunity to purchase their groceries online from a respected business is impressive. If Amazon implemented a minimum of any of these ideas, Amazon would not only surpass its rivals but also increase the company's revenue.
If we talk about Amazon’s next move, expanding to another city would be the right move for Amazon. Through expanding to other cities, Amazon will be able to offer to prospective consumers their goods and services. One of the best methods to enhance sales and, consequently, a company's earnings is by bringing in new clients. With this move, Amazon will strengthen its brand name.

REFERENCES

MCDONALD, CHRISTENSEN, YANG, & HOLLINGSWORTH. (2014, August 15). AmazonFresh: Rekindling the online grocery market. AmazonFresh: Rekindling the Online Grocery Market, 9-615–013.
Internet resources
The Business Model of Amazon. (2015). Retrieved October 18, 2022, from https://www.managementstudyguide.com/business-model-of-amazon.htm


Amazon Global Business Strategy. (2022). StudySmarter US. Retrieved October 18, 2022, from https://www.studysmarter.us/explanations/business-studies/business-case-studies/amazon-global-business-strategy/