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In: Finance

AMAZON COMPANY Marketing Management Economics Strategy Often, this part of the analysis is more responsible for...

AMAZON COMPANY

Marketing

Management

Economics

Strategy

Often, this part of the analysis is more responsible for understanding the long run attractiveness of the company. This includes, but it is no limited to, SWOT analysis, Market positioning, Strategic Management Issues and Special Situations such as mergers and Acquisitions, Restructuring or other related issues. The source for this type of information would be analyst reports, magazines such as Forbes, Fortune, Business Week etc. and newspapers such as the WSJ, Barron's, NYT etc.

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Expert Solution

Amazon has grown much faster than the entire U.S. e-commerce market, meaning that the company has actually increased its market share by taking it from competitors. The   main   factors     are   involved.

Microeconomic factors are company-specific trends. These are the factors in your business that keep it afloat. Revenue, earnings and margin are the key micro factors at your company. The size of your workforce, the production volume of your products and your advertising campaigns are all micro factors as well. In short, micro factors are parts of your business that can be fine-tuned and changed by the management.

Macroeconomic factors are national and global events which are out of your control.

It trends are largely cyclical, but are impossible to accurately time. Like a captain of a tiny schooner on the open seas, you may be able to watch for warning signs of a brewing storm, but it is impossible to gauge its full impact until you are smack in the middle of it.

Amazon focussing the market penetration the dealing with   sellers and   buyers . affiliate marketing and also the   the great Indian shopping deal, sometimes   lightning deal. The products are in   cheaper price compared to the outer market. The   genuine the seller the focus about the fake the sellers involve into amazon . then some customers are judge the this seller   is good   or not the   amazon check the sellers .

Amazon is the most customer-centric company. We are guided by four principles: customer obsession rather than competitor focus, passion for invention, commitment to operational excellence, and long-term thinking. In each of our segments, we serve our primary customer sets, consisting of consumers, sellers, developers, enterprises, and content creators.

We serve consumers through our retail websites and physical stores and focus on selection, price, and convenience. We design our websites to enable hundreds of millions of unique products to be sold by us and by third parties across dozens of product categories. Customers access our offerings through our websites, mobile apps, Alexa, and physically visiting our stores.

We also manufacture and sell electronic devices, including Kindle e-readers, Fire tablets, Fire TVs, and Echo devices, and we develop and produce media content. We strive to offer our customers the lowest prices possible through low everyday product pricing and shipping offers, and to improve our operating efficiencies so that we can continue to lower prices for our customers.

The current and potential competitors include: (1) online, offline, and multichannel retailers, publishers, vendors, distributors, manufacturers, and producers of the products we offer and sell to consumers and businesses;

(2) publishers, producers, and distributors of physical, digital, and interactive media of all types and all distribution channels;

(3) web search engines, comparison shopping websites, social networks, web portals, and other online and app-based means of discovering, using, or acquiring goods and services, either directly or in collaboration with other retailers;

(4) companies that provide e-commerce services, including website development, advertising, fulfillment, customer service, and payment processing;

(5) companies that provide fulfillment and logistics services for themselves or for third parties, whether online or offline;

(6) companies that provide information technology services or products, including on premises or cloud-based infrastructure and other services; and

(7) companies that design, manufacture, market, or sell consumer electronics, telecommunication, and electronic devices.

Synergies between Marketplace, Amazon Web Services and Prime

Amazon is involved in 3 key businesses:

  • Amazon Marketplace
  • Amazon Web Services (AWS)
  • Amazon Prime

All three Amazon offerings support each other and create benefits that would not be achieved if the businesses operated independently.

Every merger has its own unique reasons why the combining of two companies is a good business decision. The underlying principle behind mergers and acquisitions ( M & A ) is simple: 2 + 2 = 5. The value of Company A is $ 2 billion and the value of Company B is $ 2 billion, but when we merge the two companies together, we have a total value of $ 5 billion. The joining or merging of the two companies creates additional value which we call "synergy" value.

Synergy value can take three forms:

  1. Revenues: By combining the two companies, we will realize higher revenues then if the two companies operate separately.
  2. Expenses: By combining the two companies, we will realize lower expenses then if the two companies operate separately.
  3. Cost of Capital: By combining the two companies, we will experience a lower overall cost of capital.

For the most part, the biggest source of synergy value is lower expenses. Many mergers are driven by the need to cut costs. Cost savings often come from the elimination of redundant services, such as Human Resources, Accounting, Information Technology, etc.However, the best mergers seem to have strategic reasons for the business combination.

Every company has different - differences in culture, differences in information systems, differences in strategies, etc. As a result, the Post Merger Integration Phase is the most difficult phase within the M & A Process. Now all of a sudden we have to bring these two companies together and make the whole thing work. This requires extensive planning and design throughout the entire organization.

the board of directors for each corporation must initially pass a resolution adopting a plan of merger that specifies the names of the corporations that are involved, the name of the proposed merged company, the manner of converting shares of both corporations, and any other legal provision to which the corporations agree. Each corporation notifies all of its shareholders that a meeting will be held to approve the merger. If the proper number of shareholders approves the plan, the directors sign the papers and file them with the state. The secretary of state issues a certificate of merger to authorize the new corporation.

One very important element within the M & A Agreement is representation by both companies. Both sides must provide some warranty that what has been conveyed is complete and accurate. From the buyers (acquiring firm) viewpoint, full and complete disclosure is critical if the buyer is to understand what is being acquired. Discovery of new issues that have been misrepresented by the seller can relieve the buyer from proceeding with the merger.

From the seller's point of view, full disclosure requires extensive time and effort. Additionally, it is difficult to cover every possible representation as "full and accurate." Therefore, the seller prefers to limit the number of representations within the M & A Agreement. One way of striking the right balance is to establish materiality limits on certain representations. The M & A Agreement will also include language, such as "to the best of the sellers knowledge," in order to alleviate some representations.

Once all issues have been included and addressed to the satisfaction of both companies, the merger and acquisition is executed by signing the M & A Agreement. The buyer and the seller along with their respective legal teams meet and exchange documents. This represents the closing date for the merger and acquisition. The transaction takes place through the exchange of stock, cash, and/or notes. Once the agreement has been finalized, a formal announcement is made concerning the merger between the two companies.

It should be noted that due diligence extends well beyond the closing date. Therefore, actual payment may be deferred until legal opinions can be issued, financial statements audited, and the full scope of Phase II Due Diligence can be completed. It is not uncommon for many conditions to remain open and thus, the M & A Agreement may require amendments to cover the results of future due diligence.


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