Carolyn Cummins
April 18, 2012
The Age
Amazon is extending its web of influence.
IT’S a move that will make Australia’s bricks and mortar retailers shudder.
Amazon – the world’s largest online retailer – is in the market for a local warehouse in Australia as part of its massive global distribution network.
The global giant, which made its name as an online book seller, is now said to be turning its eyes to the Asia-Pacific region.
Agents say the group has been making it known in real estate circles that its expansion plans will include Australia, due to the supply of good-quality warehouses at attractive rentals.
By having an Australian-based Amazon distribution centre, delivery times and possibly costs, will also be curtailed – not good news for a retail sector feeling the pinch from online sales.
It is understood representatives of the global giant are preparing to visit in coming months to tour prospective sites down the eastern seaboard with the potential to lease an existing property, or sign up as a pre-committed tenant for a greenfields property.
In the past two years Goodman Group has built nine warehouses, covering about 700,000 square metres, for Amazon, mainly across Europe, and will no doubt be talking to the group if it enters Australia in a significant way.
One agent said the idea of Amazon ”kicking tyres” in Australia made good sense, given the internet is accounting for more than 10 per cent of retail sales in the country.
In the US, online shopping, or e-tailing, is closer to 20 per cent and rising. That means goods bought on the internet need to be stored and then distributed and while courier services such as DHL and Australia Post can deliver within 24 hours, having a local presence for Amazon is considered more cost-efficient.
Although, still in the early stages, it is expected the group will look at warehouses of up to 40,000 to 50,000 square metres – about the size of the sites occupied by companies such as Coles and Woolworths.
Any property would also have to be near transport hubs such as Port Botany, Sydney, and the Port of Melbourne.
It is likely to have a small impact on the besieged Australian book industry, which has seen more traditional bricks and mortar stores close in the past few years.
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