Amazing Amazon

Fairfax media is reporting that a Citi analyst is predicting Amazon could launch in Australia within 60 days:

While the exact timing of its launch remains uncertain, Citi analysts said on Thursday they expected Amazon’s local website to go live sometime next month, ahead of Black Friday on November 24, which is regarded as the start of Christmas shopping season in the US and is fast catching on here.

Separately, Business Insider has noted 7 “insane” facts about how big Amazon is.  Here are 6 of them (Sparty did not consider the 7th interesting):

  1. 7.5% of Seattle’s working-age population are Amazon employees.
  2. Amazon accounts for 43% of all online sales
  3. 1 out of every 4 US adults has Amazon Prime
  4. Amazon ships 1.6 million packages a day
  5. 45,000 robots roam the floors of Amazon’s warehouses
  6. Amazon is more valuable than all major brick-and-mortar retailers combined

Amazon or Amazing?

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35 Responses to Amazing Amazon

  1. Uh oh

    “We’ll all be rooned” said Hanrahan.

  2. chrisl

    Apparrently if you shop in one of their stores an item is scanned and paid for as soon as you put your item in the trolley

  3. notafan

    In other words Amazon is big enough to destroy Australian retail by selling into this market at a loss until everyone here in B&M goes broke, then jack up all prices as a monopoly seller.

    I, for one, welcome our new Amazon overlords.

  4. Entropy

    Pretty much, nota. Extermely low margin anyway. And it’s share price is based on ridiculous multiples, seemingly based on the theory that AMZN will jack up prices again once it has destroyed the competition, but not so high that a new entrant came rock up to spoil the party

  5. Entropy

    Mind you, anyone that makes life hard for Gerry Harvey is OK in my book.

  6. RobK

    Amazing. Let’s see what they have to offer.

  7. alexnoaholdmate

    The sooner they get here and finish off Gerry Harvey, the better.

    When Harvey Norman started out, they were accused of unconscionable business practices because they undercut all the competition.

    “It’s a free market,” was Harvey’s reply. It’s none of the government’s business, and it results in better deals for consumers – and you want to step in and make that a crime?

    Good arguments, and Harvey was perfectly right.

    Now that he’s the biggest retailer in Australia, however, Harvey’s view appears to have changed. Witness his tears about online purchases and his attempt to have Amazon banned.

    Arch-hypocrisy. Hope Amazon is his death knell.

  8. Kneel

    You can already buy from Amazon – what difference will it make if they have a local website?
    A local warehouse would be helpful – it would make deliveries quicker and cheaper, but a local website?

  9. notafan

    I could not care less about Harvey Norman.

    It might affect his franchisees selling computer stuff but I doubt big furniture will be effected, unless Amazon use Harvey Norman as a free showroom and undercut on stock from the same wholesalers.

    Not to mention Australian Post and Amazon are going to be the new gay marriage.

  10. Rebel with cause

    More than 40% of the products sold on the Amazon platform are third party. Amazon just takes a margin. The idea that they are selling below cost to jack up the prices in the future is total nonsense.

    Amazon has been aggressively plowing its profits back into the business through the consistent identification of new growth opportunities. That’s just smart business and also reflects that US investors have a preference for share price growth over dividends.

  11. notafan

    Much of Amazon is market place sellers, who either do not ship to Australia because the shipping matrix makes it uneconomic for the seller or if they do the shipping costs for the purchaser make the purchase uneconomic for the Australian buyer (or there is an international contract agreement that prohibits the sale)

    I assume Amazon will start dealing with Asian and Australian based wholesalers, and get fantabulous deals on postage from Australia Post, who will cover their Amazon losses by jacking up parcel post rates for small domestic businesses again.

  12. notafan

    The idea that they are selling below cost to jack up the prices in the future is total nonsense.

    Not suggesting that they are doing that now, just that the Australian market is small enough to make that a viable option for them.

  13. herodotus

    Amazon will take up a lot sales here. The delivery cost of items from the USA has slowed them down somewhat, but once they are local that problem will lessen.

  14. woolfe

    Delivery from the States is normally a minimum of US$ 25. A local warehouse will help heaps.

  15. Boambee John

    notafan

    unless Amazon use Harvey Norman as a free showroom and undercut on stock from the same wholesalers.

    Amazon’s revenge on Hardly Normal for the under $1000 GST imposition will be to undercut every catalogue they put out within 24 hours.

  16. notafan

    I sometimes buy dvds on either the Amazon US or UK platforms, only if they are being shipped by Amazon themselves, shipping is usually very low, last lot of three on 17 August from the US cost $14.38 au for postage delivered in two separate parcels, the second of which arrived on Tuesday the 5th September.

    Don’t tell me Amazon didn’t take a hit on shipping, or Australia Post, which would have charged at least $8 plus $8 to ship two parcels domestically, they have flat rate options for under 500g parcels but over that, it depends on distance.

  17. billie

    Wow, Gerry Harvey is certainly disliked here isn’t he?

    Wonder if it’s behavior or his personal pitch?

    I can guess both is a probable answer, but lots of people have questionable and anti-competitive business practices (Coles/Woolies, AMWU/CFMEU) but are they all hated in the same way?

    No, they are hated as organisations, not just the figurehead owner/leader.

    Somehow Gerry has managed to become cult figure

    Only here

  18. In other words Amazon is big enough to destroy Australian retail by selling into this market at a loss until everyone here in B&M goes broke, then jack up all prices as a monopoly seller.

    The old “penetration price” nonsense. Please provide an historical example of this ever happening.

    BTW you realise anyone can sell online via ebay? how competitive is that?

  19. TheSemiMentalBloke

    I bought a respected brand guitar tuner from Amazon. Price $165 delivered from the USA. Local price $225.

  20. Perfidious Albino

    By coincidence I was at a function recently with Gerry as the keynote speaker – certainly a character.

    He claimed not to be overly concerned by Amazon (yes, he would say that!) but indicated that he would price match where he needed to and felt that ‘local’ delivery/pick up from his ‘local’ stores offered a competitive advantage in terms of less likelihood of product being damaged in transit over distance from an Amazon central warehouse.

    May be more valid in non-metro locations I guess.

  21. notafan

    I’ve been selling on eBay since 2003, the point is that Amazon have significant advantages by being able to command volume discounts from all their suppliers including postal services.

    You have to look at the number of big box stores closed in the US to realize the impact they have had on the US market, not the only factor I know, but as they have been very successful at avoided collecting state based sales taxes, that price difference would often be more than enough to push local retailers out of business.

  22. Howard Hill

    Ali Express and Banggood are cheaper and most items are free shipping. Everyone else is only selling the same Chinese crap anyway. I get stuff all the time in less than a fortnight. My wife and kids buy everything from them, from clothing, to makeup, to kitchen utensils and more, they never ever buy from Oz retailers. We’re on a first name bases with the couriers and postie. I just purchased some machine tooling 400 bucks cheaper than any Oz retailer could/would supply and it’s the same Chinese stuff.

    I really don’t see a future for Oz B&M retailers selling lightweight Chinese made widgets; between their extortionist pricing and the amount of tax and regs they have to combat in this fooked up cuntry, they are finished, the writing is on the wall for all to see.

    It was the regs and taxes that convinced me to shut up my own manufacturing/retail company 10 odd years ago. Who is John Gault?

  23. Rebel with cause

    Selling below cost for a sustained period is a great way to piss off your suppliers. No doubt Amazon will be cheaper and will generate economies of scale, but a mature company like that won’t want to jepordise their supplier relationships.

  24. lily

    Postage rates are going up with Australia Post starting from the 1st. of October, letters remain the same.

  25. DM of WA

    Welcome to the future.

  26. Selling below cost for a sustained period is a great way to piss off your suppliers.

    Coles and Woolies have been doing it to local milk producers for years now, there was a bit of a stink but they rolled on.

    If Amazon scale that model to every other Australian industry, who’s going to stop them? Certainly not the consumers, they’ll love the cheap stuff.

  27. Sparkle Motion

    I’m a bit miffed that Spartacus deemed covering Tasmania in cardboard uninteresting.

  28. JC

    Coles and Woolies have been doing it to local milk producers for years now, there was a bit of a stink but they rolled on.

    If Amazon scale that model to every other Australian industry, who’s going to stop them? Certainly not the consumers, they’ll love the cheap stuff.

    Calm the fuck down, Monster, you imbecile. There are numerous examples of Amazon-like behavior in the past and the world didn’t end. In fact it made the world a better place. Standard Oil/ Rockefeller is a near enough example.

    Producer margins aren’t falling in the US, so any loss leading by Amazon is being done through their own P/L account. Producer margins are in fact stupendously healthy.

    Sinc, Monster should be sin-binned for stupidity. Not everyday like stupidity, but stupidity of the gross sort.

  29. JC

    I want to see Gery Harvey receive a decent kicking. I can’t stand the prick. That’s just me though. I despise Bezos too, so it’s a pox on both houses.

  30. I am Spartacus

    Dear Sparkle Motion

    I’m a bit miffed that Spartacus deemed covering Tasmania in cardboard uninteresting.

    Spartacus addressed Tasmania being covered in other’s GST the other day. Thought that was enough.

  31. Mitchell Porter

    If Australia had more self-respect and more sense of nationhood, we would be observing and learning from Amazon, and supporting the development of an Australian-owned and -run alternative. But we are just an American colony.

  32. Diogenes

    Tonight on ACA there was the breatheless reportage on how wonderful and convenient Amazon would be. I am looking forward to the next 2 stories in the ACA reporting cycle…
    1.Amazon ripping off Australians (this piece of tat on Amznus is 20 bucks, on amzn oz its 30 dollars)
    2these aussies have lost ther jobs because of amazon, and these shopping centres are now empty and these hard working aussies are about to loose their homes through no fault of their own
    Then will come story 3 inthe cycle (presumably after advertising has been paid) look how much cheaper amzn is than uncle harvey

  33. Louis Hissink

    Robots and their energy requirements – I wonder what Bezos’ opinion on climate change/glowball worming is. That number of robots need many batteries and electricity 24/365 to function. Not altogether a Green activity.

  34. Chris M

    What’s with the references the Australia Post?

    Only a fool would rely on them for delivery, the show is kaput. If Amazon are half smart they will use private delivery companies.

  35. a reader

    ugh I hate Amazon. If I’m going to buy cheap shit from overseas I’ll use ebay but otherwise I’d rather go into a shop and talk to a person.

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