After posting its first quarterly loss since 2015, Amazon needs to pull back on some of its ambitious growth targets.
👉 Background: We all know the story: Amazon was founded by Jeffy Bezos back in 1994 as an online bookstore... and now it's the fifth biggest company in the world. Last year Bezos handed the CEO reigns to Andy Jassy.
👉 What happened: In the first quarter of 2022, Amazon posted its first quarterly loss since 2015... and its slowest revenue growth in about 20 years. Not to mention its stock has fallen around 40% in the last 12 months.
👉 What else: Now, Amazon is pulling back on some of its aggressive growth targets, because the company's demand forecasting wasn't quite on point.
💡Demand forecasting is the process of making estimations about future customer demand. It's critical to the success of a business.
💡It can help businesses plan their inventory, set budgets, and gives an insight into how the business will grow in the near future. Amazon has one of the most sophisticated demand planning systems in the world called SCOT - Supply Chain Optimisation Technology.
💡The problem is that Scotty didn’t know how to plan for life during a pandemic... or post-lockdown. So Amazon hired more than 10,000 people and now it needs to undo some of that over-expansion.
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