Amazon Australia is coming. Are you ready?

Thursday 1 December 2016
Nic Crowther's picture
Co Editor
The Shaker

Richard Goyder, Chief Executive of Wesfarmers, couldn’t have put it more plainly: Amazon, if it launches in Australia, will “eat all our breakfasts, lunches and dinners” in the absence of legislative reforms and significant innovation from Australian retailers.

And Amazon will come to Australia - it’s simply a matter of when. The e-commerce giant has already been embraced by domestic shoppers, with more than $500 million being funnelled through the British, American and European websites.

 


Wesformers Chief Executive, Richard Goyder

 

Should a local site be offered – with more convenient shipping options and the lure of same-day delivery – some analysts predict that Amazon could swallow $4 billion (or close to one per cent) of all retail spending within its first year.

 

 

That’s ALL retail spending – whether it currently occurs at supermarkets, Westfield, Harvey Norman or online.

Interestingly, Amazon is also looking at building bricks-and-mortar outlets in every state in Australia. As reported by The Financial Review, these will be located in regional centres.

 

 

It’s probably a good idea to dump your shares in JB Hi-Fi and Harvey Norman. They are just two of the large retailers that are expected to be hammered by Amazon building an Australian presence. It won’t be long before we hear Gerry Harvey – the man who made a fortune flogging Chinese-made televisions – again firing up his ‘Buy Australia’ rhetoric.

 

 

Electronics retailers are not the only ones quivering in their boots. Amazon is also looking to make a foray into fresh food – and that’s why Wesfarmers is nervous.  To date, online grocery shopping has made little headway in the market.

 

 

There seems to be a couple of reasons: for retailers, picking stock is costly and inefficient while, for buyers, simply popping in to the shops on the way home is quick and simple process, rather than committing to meet a home delivery.

Rumours have March as a launch date. Certainly, Amazon reps are on the ground and laying down the foundations for a local operation. Australia’s biggest retailers will need to move fast to counter the impact of Amazon, and there is not doubt who the winner will be…

…Australian shoppers.

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