A few weeks ago, there was speculation that Amazon was planning on entering the Australian market. For a company that has disrupted every market it has entered, this speculation was enough to hit the Australian stock markets.
The company has taken rather quick steps to set up its presence in Australia. Amazon officially opened its 24,000-square meter center in Melbourne’s Dandenong South. The flagship fulfillment center will be in Pellicano’s M2 Industry Park, providing easy access to the South Gippsland Highway, Monash Highway and Eastlink. Amazon’s head office will be in Sydney and will be helmed by Rocco Braeuniger, who takes on the role of Country Manager and was previously Director of Consumables at Amazon Germany.
The company’s Australian arm began an order-taking trial on Thursday. The trial kicked off at 3 p.m. with the Amazon Australia website’s search box filling in product names automatically.
“It’s obviously working because auto-population is there,” said Liz Cassidy, founder of Amazon-registered beauty products retailer Third Sigma.
Cassidy, who already sells products overseas via Amazon, said she had made no Australian sales in the first hour, but noted that the trial involved a limited number of shoppers. Australia has long had Amazon-registered sellers but they have been limited to sending goods offshore as Amazon had no warehouse in the country.
Shares of Harvey Norman, Australia’s biggest electronics retailer, are down 9 percent since said speculation surfaced. Shares of Australia’s biggest department store chain Myer Holdings Ltd are down 39 percent.
“It’s not as if the majority of retailers in Australia are making a fortune and growing their businesses,” said Gerry Harvey, executive chairman of Harvey Norman. “If you’re in clothes and shoes and handbags, you can’t take a lot more pressure.”
“It will be really interesting to see whether it lives up to the hype,” said Tim McKinnon, the Australian managing director for eBay Inc., an Amazon competitor.