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Amazon Leases Office Space, As Gerry Harvey Calls For Them To Be Banned

Amazon is well advanced in their assault on the Australian market with the US online retailer leasing more than 10,000sq m of office space at the Citigroup Centre in Sydney’s central business district.

ChannelNews understands that several commercial real estate agents are currently in the market looking for “appropriate” distribution centres.

During a recent New York trip, I was told that the group who have been briefed to secure space for Amazon is The Goodman Group who already have a close relationship with Amazon in the USA. They were also responsible for finding and then hosting Amazon’s data centre in NSW.

In Australia, Goodman owns, develops and manages several industrial and business space. Their current portfolio consists of 164 properties located in Sydney, Melbourne, Brisbane, Adelaide, Canberra and Perth.

They currently provide logistic operations for Toll, Linfox, DHL, Coles, Coca-Cola, TNT and Brambles.

Yesterday Gerry Harvey yesterday slammed Amazon claiming the company as “not a good corporate citizen” and accused it of having long-term plans to control the market via predatory pricing.

Harvey said that “transport costs” will be a major problem for Amazon.

In an interview with the Herald Sun Harvey branded US Amazon “the world’s greatest tax evader” and says the Federal Government should consider blocking its entry into Australia.

Mr Harvey says Amazon’s success is based on predatory pricing and tax avoidance.

Its full entry into Australia will leave the nation poorer as retailers without the financial reserves to withstand its ­assault go broke, he says.
“They have been the world’s greatest tax evader,” Mr Harvey said of Amazon.

“They have spent their life sending small business and big business broke all across America. They want to come here and pay no tax and do the same thing.

“Keep Australia great for a change instead of letting someone of that ilk in to cause havoc which would be of no benefit to anyone.”

Harvey also questioned how Amazon was a “good fit for Australia”. “Why would we even let them in,” he said. “If they are going to come in and use predatory pricing to send other businesses broke, I don’t get why that is a good idea.

“If they are going to come in and pay no tax, I don’t get why that is a good idea.”

Mr Harvey said Harvey Norman had the financial muscle to take on Amazon — pointing to its strong balance sheet — and said the US rival would find logistics in Australia far more challenging than anything it had experienced.

“We will be happy to equal their prices and if they are predatory prices, trying to send us all broke, we will be saying to the government that is against the law,” he said.

ChannelNews understands that Amazon has already cut a deal with Australia Post who are not denying that they already have a relationship with the US online retailer. We have also been told that Amazon is looking at deliveries being made by Uber drivers and that the Company is also looking at drone deliveries in certain areas of Australia.

Other groups that a keen to work with Amazon are Jones Lang LaSalle, Colliers International, CBRE and Knight Frank.

Citi analysts have warned that Amazon could have problems developing a supply chain and dealing with Australia’s lower population density in major capitals.

They also claim that a top priority will be consumer electronics and small appliances.

Outgoing Wesfarmers chief executive Richard Goyder has repeatedly warned the US retailer will “eat all our breakfasts, lunches and dinners”, and the group’s entry could cost local retailers as much as $4 billion in sales.
Some say this is the reason why Wesfarmers has moved to sell their Officeworks retail chain ahead of the launch of Amazon in Australia.

Amazon has lodged trademarks for products including Amazon Echo, Amazon echo Dot, Amazon Dash and Amazon Tap, allowing the group to offer shopping tools to Australian consumers similar to what they do in the USA.

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