American super retailer Amazon is set to open an Australian arm in September this year.
Amazon is a retail giant that started as an online bookseller and has now become a store where you can buy everything. This ‘everything’ store will be arriving on Australian shores with plans to disrupt the entire Australian retail scene. The retailer is currently raking in nearly 1 billion dollars in online commerce from Australian shoppers and when the local arm opens that market share is speculated to increase.
Amazon is set to compete with Australian retailers on some fronts, from anything to electronics and consumer goods to fresh food. Australian supermarket chains are likely to be impacted by Amazon Fresh the grocery delivery arm of the business. If Amazon Fresh is comparable to the US version, it will deliver food within 2 hours through the Amazon Prime Subscription service.
But what does that mean for local retailers? It depends on where you sit. For the larger players such as Myer, Harvey Norman, Kmart and JB Hi Fi there will be a decrease in their considerable market shares. However, on the opposite side of the spectrum, there are small businesses that could benefit greatly from the Amazon Marketplace part of the entity.
Amazon Marketplace is an e-commerce platform owned and operated by Amazon that provides third-party sellers with a platform to sell new and used offerings online alongside Amazon’s regular products. This will give many small businesses the ability to increase their reach nationally and internationally with the marketing might of the Amazon name.
There is speculation with the increased competition more established retailers will have to step up their customer service and create perks for shopping in store. While the larger players are grappling with what it will mean to compete with a global giant, they will also have to content with a level playing field that the platform will offer to the smaller Aussie businesses.
This will not be as much as a stretch for smaller businesses who have had to adhere to high standards of customer service to compete against the larger Australian retailers.
At the moment no one knows the exact plans Amazon has for its Australian operations, but one thing is for sure, the Australian retail scene is set for a shake-up!