August 14, 2017/ News
It has finally happened. After much anticipation, Amazon has officially landed and is currently in the process of setting up their Australian launch. Amazon has recently unveiled the location of its first distribution centre in Australia - Dandenong South in Melbourne.
Dandenong South, specifically the M2 Industry Park that Amazon's fulfillment centre is situated in, is already a popular location for major retailers' distribution centres, such as Aldi and Bunnings. This is mainly due to its easy access to the South Gippsland Highway, Monash Highway, Eastlink and rail transport. Since one of Amazon's main selling points is fast and extensive delivery, this will be a critical factor in ensuring that their foray into the Australian market will be as smooth as possible.
The massive 24,000 square metre warehouse will hold "hundreds of thousands of products" to be delivered to customers across the country. More warehouse spaces around the country are likely to be acquired in the future once Amazon is up and running and demand increases.
Amazon's official entrance into the Australian market will lead to a significant boost in jobs for Australians. Amazon announced that it would generate hundreds of jobs and bring millions of dollars of investment to our shores. Amazon's director of operations in Australia, Robert Bruce, was even more optimistic, stating that in the long term the retailing giant would create "thousands of new jobs" in Australia.
Amazon appears to be on its way to keeping this promise, with job advertisements for various positions already being posted online. Some of these positions include, area managers, merchant product managers, senior PR managers, pick packers, HR specialists, systems technicians, and so on. Amazon is steadily building its workforce and pool of talent.
Amazon's entrance will also be welcome news for consumers since competition will be increased and price wars may be induced, as local retailers will try to maintain/build their market share. Essentially, consumers are expected to benefit as choice will be increased and they will receive more bang for their buck, as local retailers will try to go head-to-head with Amazon. This may be a tough task for bricks and mortar retailers due to the sheer scale of Amazon and the low-cost and high efficiency of their operations.
Amazon's entrance into the Australian retail market may be good news for job seekers and consumers, however, not everyone is embracing this retailing giant. Local retailers and physical stores are predicted to feel the sting of Amazon. Significant losses are predicted for major retail companies that compete in the same markets that Amazon does, such as JB HI-FI, Myer, and Harvey Norman. The temptation of Amazon's convenience, speed, and cheap prices may prove to be irresistible to the Australian consumer and another nail in the coffin for domestic retailers.
However, Australian retailers won't be going down without a fight. Gerry Harvey, founder of Harvey Norman, is skeptical of how successful Amazon will be since Australia has a low population and high labour costs. This will definitely be a hurdle that Amazon will need to overcome, as it directly goes against their primary strategies and may prevent them from achieving the scale of operations that they're accustomed to.
Only time will tell if Amazon will be the fierce retail competitor that it is expected to be.
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