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Amazon plans to debut in SE Asia

News, 03 November 2016

SINGAPORE: Amazon, the US e-commerce giant, has already established itself as a major player in India, but now it is reported to be planning to launch in Southeast Asia.

According to two industry sources who spoke to TechCrunch, Amazon intends to launch in Singapore in the first quarter of 2017 when it is likely to offer its Prime delivery service alongside its AmazonFresh grocery service.

The sources disclosed that Amazon is quietly acquiring assets, including refrigerated trucks, while also hiring staff ahead of its entry into Singapore.

Amazon declined to comment on the report, but the TechCrunch sources said the initiative is being led by Steven Scrive, the company's ASEAN head of business development.

Amazon does not currently offer local services in Southeast Asia, but the region has a population estimated at 600m and its digital economy is undergoing rapid change.

According to TechCrunch, there was speculation earlier this year that Amazon was looking to establish itself in Indonesia, the region's most populous country, but its sources said the company is fully focused on expanding into Singapore at this stage.

The city state's small size, Western-orientated consumer culture, and sophisticated infrastructure and logistics makes it an attractive starting point for Amazon's regional expansion plans.

And its attempted takeover of RedMart, the Singaporean online retailer, earlier this year was a possible sign of Amazon's ambitions, but that deal fell through because the bid was deemed too low.

However, in a further development, it is reported that RedMart has now been acquired by Lazada, another Singaporean operator in which China's Alibaba has a controlling stake.

"Through this partnership, we can further scale our logistics and tech platform to extend our product assortment and to offer an even more convenient service for our customers in Singapore," said Roger Egan, co-founder and CEO of RedMart.

"As part of our growth strategy, we are always looking for ways to serve our customers better by adding new product categories and improving our service offering," added Maximilian Bittner, CEO of Lazada Group.

The two items of news suggest that the rivalry between the world's largest e-commerce players is about to intensify with the latest front opening up in Singapore.

Data sourced from TechCrunch, Channel News Asia; additional content by Warc staff