Amazon confirms first Aussie fulfilment centre

Amazon (1)Online retail giant Amazon will open its first Australian distribution warehouse in Melbourne’s south eastern suburbs, in a move the company says will create hundreds of jobs.

Amazon has announced it will open a 24,000 square metre fulfilment centre in Dandenong South at the M2 industrial park.

The company’s Australian director of operations Robert Bruce said “this is just the start” for Amazon.

“Over time, we will bring thousands of new jobs to Australia and millions of dollars of investment as well as opening up the opportunity for thousands of Australian businesses to sell at home and abroad through Amazon Marketplace,” he said.

He promised hundreds of thousands of products would be stocked at the new warehouse at low prices for Australian consumers.

The new centre is located in the Pellicano’s M2 Industry Park in Dandenong South, which Amazon said provides easy access to the South Gippsland Highway, Monash Highway and Eastlink. The building is also in close proximity to a wide range of amenities for employees. The lease of the centre was facilitated by CBRE’s Industrial & Logistics business.

Victorian Industry Minister Wade Noonan said it was the latest global company to choose the state for its Australian operations.

“The company’s decision to locate its centre in Dandenong South will create hundreds of local jobs and open up retail opportunities for thousands of local businesses,” Noonan said.

The international giant has already started to recruit staff including operations managers, pickers, packers, systems technicians and HR specialist.

The company already has 1000 employees in Australia.

Recently, Amazon reported a jump in retail sales but its profits took a big hit as the e-commerce giant continues investing in a number of costly areas, including video, fulfilment centers and international expansion within fast-growing economies such as India.

The world’s largest online retailer has reported a 77 per cent slump in quarterly income and forecast a potential operating loss in the current quarter, $US300 million ($A376 million) to a loss of $400 million.

Nine in ten Australians said they will purchase from Amazon Australia if it delivers on its lofty promises, according to a study commissioned by parcel delivery service, CouriersPlease.

The results of an independent survey of 1,001 Australian adults who have shopped online at least three times in the last six months showed 90 per cent of Australian online shoppers think they will purchase from the e-commerce giant if it fulfils its promise to deliver low prices, vast selection and fast delivery.

However, other research from finder.com.au says Australians are showing mixed reactions to the arrival of retail giant Amazon in Australia.

According to finder’s research, half of the population, about 47 per cent, indicated they are excited about the retailer coming to Australia, hanging out for cheaper deals, a bigger range of products and fast delivery.

But 53 per cent aren’t so keen, preferring to shop at brick and mortar stores, or worried about its impact on local business.

Bessie Hassan, money expert at finder.com.au, said while Amazon appeals to many shoppers, some would take some convincing.

“While it is certainly grabbing a lot of headlines in Australia, Amazon needs to prove what all the fuss is about before most consumers will change their buying habits,” Hassan said.

Speaking to Inside Retail, Euromonitor senior research analyst, Bettina Kurnik, said Amazon watchers have had a busy month, ever since the global e-commerce giant announced its planned acquisition of US grocer Whole Foods. Yet the developments are not restricted to the company’s domestic market, and news of its aggressive expansion globally spans across the Asia-Pacific region.

“Amazon’s launch in Singapore, for instance, was much publicised due to its offering Prime Now two-hour delivery on all purchases, and having to enlist the services of taxi, Uber and Grab drivers to make good on the promise,” she said. Meanwhile Amazon India has just announced that it will set up three more fulfilment centres, taking the total number of such facilities within the country to 41 by October 2017.

“With the confirmation that Amazon is setting up a fulfilment centre in Dandenong South we can add Australia to that list, hopefully ending the speculation around the company’s arrival to Australian shores and providing a more concrete vision of what’s in store for Australian retailers in the near future.”

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