IntroductionLaunched by Jeff Bezos, the Amazon.com site was born in 1995 and is today considered one of the most important retail sites on the Internet with a record turnover of 14 .87 billion dollars in 2007. Jeff Bezos' intention was to create an Internet-based company with the most dedicated product portfolio on the Internet where customers could find everything they they wanted. Amazon's success is based on technology, services and products (Jens et al., 2003). Inventory control is known to be one of the most difficult problems for businesses. With 39 million active customer accounts and a vision of being "the largest selection of products on Earth," Amazon has put a lot of effort into being as efficient as possible in managing inventory. The purpose of this report is to understand the evolution of Amazon's inventory management and how it has affected the company's growth. This case study is both a practice case and a troubleshooting case, so the first section of this report focuses on the practices used by Amazon in the 4 phases and then in the second section we will solve the product returns problem and provide recommendations .I- The 4 Phases of Amazon Inventory ManagementAmazon can be divided into 4 phases:1) An initial start with no inventory2) Warehouses built to store inventory3) Partnering with distributors4) Partnering with resellers1. It initially started without inventory. In the first phase, Amazon's main goal was to create a virtual bookstore, where customers could have more choices than any physical bookstore in the world, but also, it did not want to spend time and money on building warehouses and managing inventory b ...... half of the sheet ...... handwriting1. Saunders. R (2001) Amazon.com way – The secrets of the most surprising web business in the world, Capstone2. Bezos, Jeff (1998) A Bookstore By Any Other Name, viewed March 20, 2008,3. Jens, C., Peter, M (2003) The industrial dynamics of the new digital economy, Edward Elgar Publishing4. Hof, R. (1999) What's With All the Warehouses?, viewed 18 March 2008,5. Orders from merchants, viewed March 26, 2008,6. Choen, S. & Roussel, J. (2004) Strategic Supply Chain Management, McGraw-Hill7. Julie, A., Sokol & Robert, J. Thomas (2004) State of the Art, viewed 27 March 2008,8. Rao, K. and Young, R.R. (1994) Global supply chains: factors influencing the outsourcing of logistics functions. International journal of physical distribution and logistics management. vol. 24. No. 6.9. Chaffey, D (2008) Case study on Amazon.com, viewed 20 March 2008,