Experts play down impact of Amazon

Online retail giant opens for trading

DESPITE months of hysteria over the pending arrival of Amazon in Australia, retailers and academics say the online retailer’s expansion will not spell the downfall of Tasmania’s bricks and mortar shops.

Amazon — the giant American electronic commerce and cloud computing company based in Seattle — started trading in Australia yesterday with just one distribution centre in Dandenong, Victoria.

UTAS retail expert Louise Grimmer said Amazon’s retail edge — fast delivery — might not translate in Australia, especially in regional marketplaces like Tasmania.

“There was a lot of speculation last year about what Amazon’s start up in Australia might mean, some of it bordering on hysterias,” she said.

“I doubt Amazon’s arrival will impact on traditional retail sales in Tasmania this Christmas but next year’s figures could be interesting,” she said.

Retail figures released yes- terday by the Australian Bureau of Statistics show Tasmania recorded 2.68 per cent growth in retail in the 12 months to October.

Dr Grimmer expects a flurry of excitement “then Amazon will become just another part of the retail landscape”.

“Unlike some of the major chains like Myer, David Jones and Harvey Norman, smaller independent Tasmanian stores will not be affected in a big way.

“I think it depends on the product category being sold. But statistics show us that 90 per cent of shoppers still want to visit bricks and mortar shops. People still enjoy going shopping and, at Christmas, it is part of the traditional build up.”

In the lead up to its arrival, Amazon was dubbed “Death Star” of retailers.

Amazon said in a statement that Australia customers would receive free delivery on eligible orders above $49 but a one-day delivery service would only be available in select areas.

The National Retail Association agrees that Amazon’s success in the US may not be replicated in Australia.

“In France, its performance is less than stellar and, in Canada, it’s really struggling,” association chief executive Dominque Lamb said.

“Due to Australia’s unique market challenges [sparse population, lack of delivery infrastructure, highly complex IR laws, to name a few], experts are tipping Amazon Australia may only reach a position somewhere between Canada and France, and will struggle to overcome our unique logistic challenges.”

But the Australian Retailers Association called Amazon’s arrival a “fantastic opportunity” for progressive retailers to increase their sales through their online platform. the