Amazon opens for NZ trade

Amazon Australia won’t make all of its products available to Kiwis, and it won’t be cheap getting them to New Zealand.

The Australian site has started taking orders and shipping products from its warehouse in Melbourne’s east.

‘‘Millions’’ of products are available across 23 categories, including electronics, sports and outdoor goods, toys, home improvement items and tools, and clothing and accessories, it said.

Amazon was an opportunity for New Zealand retailers, and brickand-mortar stores wouldn’t feel the pressure until at least Christmas next year, giving them time to adapt, retail technology developer Danny Ing said.

‘‘Amazon will probably get quite efficient with shipping here because it will be very much like shipping to Western Australia, and they could get it down to next-day delivery from Melbourne or Sydney,’’ he said.

If that happened, New Zealand retailers could see drop in sales of between 5 per cent and 15 per cent on products that compete directly with Amazon, such as electronics, toys and giftware.

‘‘Brick-and-mortar stores need to be connected to the wider market with their e-commerce site and Amazon, if that’s the marketplace you’re going to use, and then connect those to your physical stores.’’

Currently, it appears only some products are able to be delivered to New Zealand, and shipping costs come under ‘‘All Other Areas’’ costing A$19.99 (NZ$22.16) for 1-3 business day delivery, A$9.99 for 3-7 days, and free 7-10 day delivery for orders over A$49.

Ing said that in the future all shopfronts would serve as showrooms or ‘‘mini-depots’’ for a retailer to fulfil online sales.

‘‘Amazon has an automated supply chain, and that’s how it got so big,’’ he said. ‘‘If you don’t automate your supply chain, you’re stuck with processes that require more human intervention, and the more intervention you need the less scalable you’ll be.’’

Amazon has launched with its own retail offer, in which it sells and ships items direct to customers, and its ‘‘third-party’’ marketplace, which allows other businesses to sell through Amazon’s website.

First Retail managing director Chris Wilkinson said Amazon had soft-launched to Australian consumers to lessen pressure on its systems and supply chain. Problems on those fronts could damage goodwill, he said.

‘‘There will no doubt be some initial issues, so Amazon will want to identify and address these before volumes ramp up.’’

There were rumours Amazon may set up a warehouse in Waikato, but Wilkinson said this was highly unlikely.

‘‘The market is simply too small. If they did, it would be the smallest market where they had dedicated real estate and infrastructure,’’ he said.

Goods were likely to come from Amazon’s Melbourne warehouse and its many facilities in the United States, he said.

Amazon has been approached for comment.