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EXCLUSIVE: Amazon To Launch In Q4, CE, Toys & Household Retailers Targeted

Amazon will launch their Australian operations in Q4 2017 according to briefings given to consumer electronics suppliers.

During the past month, the US online retailer has been negotiating trading terms with suppliers operating in Australia.

ChannelNews understands that Amazon will initially target retailers selling consumer electronic and household goods.

Several suppliers to consumer electronics retailers, who have already had meetings with Amazon, have said that they anticipate that up to 20% of their revenues could come from the online retailer within 12 months.

According to one manufacturer who is a major supplier to Amazon in Europe and the USA the Amazon software that suppliers have been shown allows them to instantly adjust prices as they track changes being made to local retailer’s web sites.

A director at one supplier who did not want to be named said that Amazon is targeting online retailers such as Kogan and Catch as well as stores such as Big W, Officeworks, Target and K Mart, as well as mass consumer electronics retailers. One category that is set to come under pressure is toys said one supplier who is aware of Amazon’s plans.

“They intend to set their prices up to 20% to 30 percent below mass retailers running into the peak last quarter. This will create real problems for the mass retailers because they will be operating on pre negotiated contracts”.

They added” During the past month we have been working with Amazon as well as our parent Company who is a major supplier to Amazon to finalise trading and supply terms”.

When asked about logistics and supply they said, “We are under NDA and we cannot talk about this but trust me Amazon have already worked out a go to market logistics strategy for Australia”.

Another supplier said “We cannot wait to see what happens to our sales in Australia when we trade via Amazon. If it goes the same way as in several other Countries where we sell via the Amazon portal we can expect excellent sales. This will result in several suppliers to retailers such as Harvey Norman and JB Hi Fi renegotiating rebate and marketing expenditure with these retailers”.

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