Amazon CEO Andy Jassy says Amazon's new offering—Amazon Supply Chain Services—is a way to extend its logistics expertise to businesses of all sizes, following an approach the company has used with its Marketplace for independent sellers and with AWS.
In a recent interview with CNBC's Jim Cramer, Jassy said the goal is to use services Amazon has built for its own logistics to help save others time and money. Similar to AWS, when Amazon extended its own internal cloud infrastructure services to enterprises, this gives other companies the benefit of Amazon's experience and extensive network. AWS has grown into a $150 billion annual run-rate business, and Jassy is optimistic about what this new supply chain services offering will be able to do.
"Most companies don't feel like it's a good idea to have to run their own logistics when they can use our supply chain services," Jassy said. "And so if you think about what we had to do as a retail business, we had to get really good at being able to move products from manufacturers to upstream storage warehouses, to the actual fulfillment centers where you actually do the fulfillment, to allowing people to sell in multiple marketplaces but have one inventory pool, to the last mile delivery. We had to get good at all those to scale our retail business. ... It makes so much sense to expose these services to companies of all sizes."
Jassy said the value proposition is straightforward.
"If we can provide those components at a very cost-competitive rate like we do, and at a very high quality, it's very compelling," he said.
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