The Urban Developer
AdvertiseEventsWebinars
Urbanity
Awards
Sign In
Membership
Latest
Menu
Location
Sector
Category
Content
Type
Newsletters
Untitled design (8)
2 WEEKS UNTIL OUR UNMISSABLE FLAGSHIP CONFERENCE MORE THAN 550 ALREADY ATTENDING
2 WEEKS UNTIL OUR FLAGSHIP CONFERENCE 550+ ALREADY ATTENDING
REGISTER NOWDETAILS
TheUrbanDeveloper
Follow
About
About Us
Membership
Awards
Events
Webinars
Listings
Resources
Terms & Conditions
Commenting Policy
Privacy Policy
Republishing Guidelines
Editorial Charter
Complaints Handling Policy
Contact
General Enquiries
Advertise
Contribution Enquiry
Project Submission
Membership Enquiry
Newsletter
Stay up to date and with the latest news, projects, deals and features.
Subscribe
ADVERTISEMENT
SHARE
print
Print
OtherStaff WriterTue 27 Sep 16

Amazon Plans To Enter Market, Retailers Expect Shake-Up

iStock_85850561_SMALL_620x380

Online retailer Amazon has reportedly set sights on the Australian market which has raised concerns from major companies like JB Hi-Fi and Harvey Norman.

It is possible for Amazon, once integrated in Australia's retail sector, to generate sales of up to $4 billion in Australia with a focus on electrical items, which would impact competitor earnings. JB Hi-Fi, for example, is estimated by Brokers to lose around 23 per cent of their earnings, while Harvey Norman could lose 9 per cent.

Brisbane Times reported that Amazon was in the market for warehouse properties in Australia in 2014 , but no decision was made to lease any property.

Australians reportedly spend approximately $500 million to $700 million on all Amazon websites, which illustrates findings detailed in a 40-page report developed by retail analysts at stockbroking firm Citi.

Citi analyst Craig Woolford said Australia was one of three lucrative markets in which Amazon had only a digital offering and "ticks all the boxes" for the retailer according to Brisbane Times.


"Its full product offer is likely to follow, given Australia has all the right ingredients and will take inspiration from its US fulfillment solutions to deal with the distances in Australia," Mr Woolford said.

"Based on other developed markets and recognising eBay's large presence in Australia, we expect Amazon could reach $3.5 to $4 billion in revenue.

"This would be about 14 per cent of all online sales and 1.1 per cent of all Australian retailing.

"Potentially the most heavily impacted retailer from Amazon's entry would be JB Hi-Fi, given the overlap of product and potential pressure on profit margins," he said.

It is unclear what the implications are for the industrial and retail development sector if or when Amazon decides to officially penetrate the Australian market.

Developing the needed stores, warehouses and supply chains and dealing with Australia's lower capital city population density makes entry more challenging, after Amazon's approach to logistics and supply chain strategies evolving considerably since 2013.

According to Brisbane Times, the company has formulated and implemented a program known as "Fulfillment by Amazon" that aims to take greater control over global and last-mile delivery of its goods, shifting the burden and power gradually away from large third-party logistics companies, such as DHL and Fed Express, known as 3PL providers.

RetailIndustrialAustraliaFinancePlanningPlanningSector
AUTHOR
Staff Writer
"TheUrbanDeveloper.com is committed to delivering the latest news, reviews, opinions and insights into the best of urban development from Australia and around the world. "
More articles by this author
ADVERTISEMENT
TOP STORIES
The Port of Brisbane has released its Vision 2060 which details the need for inland rail connectivity
Infrastructure

Brisbane Port’s $15bn Future Faces One Big Obstacle

Renee McKeown
5 Min
Freecity Rouse Hill triple towers 2 Tempus Street
Exclusive

Freecity Takes Covers Off $330m Triple Towers in Sydney’s North-West

Leon Della Bosca
5 Min
Parallel Workshops Stockdale Housing PBSA project
Exclusive

Suburban Success Story Turns PBSA Thinking on its Head

Leon Della Bosca
7 Min
Exclusive

Interstate Developers Find Lots to Love in ‘Progressive, Affordable’ SA

Taryn Paris
5 Min
Bates Smart Richmond Sportslink HERO
Exclusive

BtR Focus Drives Bates Smart’s Richmond Sportslink Concept

Leon Della Bosca
6 Min
View All >
Industrial

Inland Rail: Site at Rural Hub Comes to Market in Victoria

Lindsay Saunders
Stockland's Triniti HERO
Build-to-Rent

Stockland $400m North Ryde BtR Approved on Appeal

Leon Della Bosca
Residential

Home Affordability Gap Widens Across Asia-Pacific

Lindsay Saunders
Income growth and price dips have done little to improve the situation, according to fresh data from the Urban Land Inst…
LATEST
Industrial

Inland Rail: Site at Rural Hub Comes to Market in Victoria

Lindsay Saunders
2 Min
Stockland's Triniti HERO
Build-to-Rent

Stockland $400m North Ryde BtR Approved on Appeal

Leon Della Bosca
3 Min
Residential

Home Affordability Gap Widens Across Asia-Pacific

Lindsay Saunders
3 Min
The Port of Brisbane has released its Vision 2060 which details the need for inland rail connectivity
Infrastructure

Brisbane Port’s $15bn Future Faces One Big Obstacle

Renee McKeown
5 Min
View All >
ADVERTISEMENT
Article originally posted at: https://theurbandeveloper.com/articles/amazon-enter-market-retailers-expect-shake-up