Get a demo Do I subscribe? News sign-up
Download PDF
Print

Amazon to launch retail services in Australia

News, 21 April 2017
Topics

SYDNEY: Amazon, the e-commerce giant, has said it will expand its offering in Australia to include retail services with "low prices, vast selection, and fast delivery" later this year.

It is currently looking for a warehouse to repurpose as a fulfilment centre, the Sydney Morning Herald reported, with Sydney, Melbourne and Brisbane all possible locations.

The company already has a presence in the country through its Amazon web services, which launched in 2012.

"We launched a Kindle store on amazon.com.au in 2013 and we now have almost 1,000 employees in the country," Amazon said. "The next step is to bring a retail offering to Australia, and we are making those plans now."

It also stressed job opportunities, the empowerment of small business, and "millions of dollars" of long-term investment.

Though it has released no fixed timetable for the expansion, Business Insider suggests that some services could arrive as soon as July.

According to analysis by Morgan Stanley, Amazon already enjoys $1 billion in sales by overseas shipment to Australia, in addition to its web services sales, including Amazon Prime streaming and ebooks through the Kindle Store.

Figures from the National Australian Bank show a keen appetite for online retail in the country, as consumers spent around $20bn online in the 12 months to June 2016, a year on year increase of 13.5%.

"We are optimistic that by focusing on the things we believe customers value most – low prices, vast selection and fast delivery – over time we'll earn the business of Australian customers," the company said.

Analysis by Credit Suisse last month showed that Amazon is likely to attain more than 5% market share in a number of retail categories within five years. This spells difficulty for many Australian retailers, who have relied on a beneficial cost structure.

"Amazon is likely to cause a fall in prices in some categories that either generate excess profit or where the existing Australian cost structure is excessive – excess profit and excess cost both being reduced," Credit Suisse said.

Data sourced from Sydney Morning Herald, Business Insider, Financial Times; additional content by WARC staff

Topics