Advantages and Disadvantages of Selling through Amazon and Big Box Supply Chain Model

This article discusses the advantages and disadvantages of selling through Amazon and the big box supply chain model. It also explores the impact of these models on brand value and sales volume.

Running head: SUPPLY CHAIN MANAGEMENT
Supply chain management
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1SUPPLY CHAIN MANAGEMENT
There will be a number of advantages as well as disadvantages to be faced by the
Cardinale family in selling through Amazon. One of the major benefits to be gained by them is
having the access to huge potential customers. This is due to the reason that Amazon is having
huge market penetration in the Australian as well as in the global market. Thus the brand
exposure will get increased for Cardinale by selling their products through Amazon. Another
major advantage that can be gained by them by selling through Amazon is enhanced brand
trustworthiness among the customers (Irnak, Wakslak and Trope 2013). This is due to the reason
that Amazon is having positive and huge brand value in the market and selling through them will
also enhance the trust and preference of the customers. This will in turn increase the sales and
market potential of the products of Cardinale.
However, apart from the advantages to be gained by them by selling through Amazon,
there are number of disadvantages also to be faced by them. One of the major disadvantages for
Cardinale will be the risk of dilution of their own brand value. This is due to the reason that the
brand value of Amazon is much higher than any individual sellers and thus majority of the goods
are sold as only Amazon products (Ritala, Golnam and Wegmann 2014). This will not help
Cardinale in the enhancing their brand value.
In the current retail business scenario, one of major and popular trends is big box supply
chain or retailing. This refers to the concept of offering huge array of products much like a
departmental store but with having more surface area. The theme of big box supply chain came
from the architectural design of having huge box like structure with averagely more than 50,000
square feet (Hanner et al. 2015). The more advantage of this type of supply chain model is
gaining economies of scale by increasing the volume.

2SUPPLY CHAIN MANAGEMENT
Fostco is one of the leading manufacturers of centralizers in the American market.
Initiation of the big box model of supply chain will help them in increasing the sales volume by
offering in more competitive prices. This is due to the reason that initiating the big box model
will help Fostco to showcase and offer their products in wider variety. Thus more customer
sections can be targeted at once that will in turn increase the sales volume and offering in lower
price will become viable.

3SUPPLY CHAIN MANAGEMENT
Reference
Hanner, D., Hosken, D., Olson, L.M. and Smith, L.K., 2015. Dynamics in a Mature Industry:
Entry, Exit, and Growth of Big‐Box Grocery Retailers. Journal of Economics & Management
Strategy, 24(1), pp.22-46.
Irmak, C., Wakslak, C.J. and Trope, Y., 2013. Selling the forest, buying the trees: The effect of
construal level on seller-buyer price discrepancy. Journal of Consumer Research, 40(2), pp.284-
297.
Ritala, P., Golnam, A. and Wegmann, A., 2014. Coopetition-based business models: The case of
Amazon. com. Industrial Marketing Management, 43(2), pp.236-249.