Amazon/Morrisons collaboration: A match made in supply chain heaven?

Over the past few days supermarket chain Morrisons announced collaboration with Amazon to distribute its products through the online retailer. The move is likely to have ruffled a few feathers among its competitors and potentially creates a significant network for Morrisons to exploit.

Tesco currently dominates the online grocery market with a 40% share as opposed to Morrisons minor 3%. Hence the partnership creates a significant path into the market utilising Amazon’s online presence and logistics structure to reach a wider network of customers. In addition, Morrisons will use its existing partnership with Ocado to deliver to a wider range of destinations across the country.

On paper the partnership looks like a fantastic opportunity for the firm to launch onto a wider platform with minimum investment. However, the difference between e-commerce and traditional supply chains should not be understated. Growth in the online market could significantly reduce efficiencies in the Morrison network if operations are not in line with the e-commerce requirements. Keeping track of growth and adapting operations accordingly is key to the success of the partnership. If done correctly, this could transform the online grocery market.