Amazon’s new warehouse

Sunday, April 20, 2008
by Geoff Riley

The leading online retailer has opened a distribution centre in Swansea Bay, which will create 1,200 jobs - this BBC news video is a great clip to show to demonstrate some of the economies of scale that Amazon is able to exploit when building a warehouse of such enormous size and students can also get a feel for some of the local and regional multiplier effects from the investment and the importance attached to such inward investment for the Welsh economy. The evaluation in discussion could be broadened to include the widening range of products that Amazon is now stocking and selling together with the fact that the majority of products in the warehouse have been imported.

Here is the link to the clip

Revision: Economies of Scale and Scope

Wednesday, April 02, 2008
by Geoff Riley

This revision note looks at economies of scale and scope - the cost advantages from exploiting increasing returns to scale

Revision_Economies_Scale_Scope.pdf

Economies of Scale

Monday, March 17, 2008
by Andrew Threadgould

How can old media (such as newspapers) compete in the digital age?

Perhaps by seeking to take advantage of serious economies of scale.

News International has recently opened a new printing press in Hertfordshire which covers an area the size of 23 football pitches - and offers quieter and faster (70,000 papers per hour) production of both broadsheets such as The Times and Sunday Times, as well as Britain’s favourite tabloid, The Sun. In addition, the headcount of people needed to run the new plant is 200 - compared to 600 with the old facilities. It is perhaps the least labour intensive printing facility in the world.

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