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Amazon finally goes live in Australia

Business

Amazon has launched in Australia, ending months of speculation around the timing of when it would finally open its full offering Down Under and setting up a sales frenzy ahead of Christmas.

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The e-commerce giant has already been selling Kindle e-reader devices, audio books and content from its Australian website but it has now activated its full-service local offering, featuring its own products and items sold by small local retailers.

The US retailer is known for sacrificing profit for sales through aggressively low prices and its greater presence in Australia is expected to benefit customers but bring more pain for local retailers.

Retail analysts at Citi believe large local electronics retailers JB Hi-Fi and Harvey Norman will be among the hardest hit by the disruption the global behemoth is expected to create.

Morgan Stanley analysts have previously warned that Kmart and Target’s parent company Wesfarmers could lose $400 million in annual earnings to Amazon by the 2026 financial year.

In November, Amazon had notified its sellers that it would begin an internal testing phase with a small number of customers.

One of Australia’s leading retailers, Gerry Harvey of Harvey Norman, says he’s not worried about Amazon and warned consumers to beware of its promises to deliver before Christmas.

“If you order something off Amazon, heads you get it, tails you don’t,” he told Seven.

He was confident Harvey Norman would not be affected by Amazon but said he was concerned with its business practices.

“We are here to take Amazon on,” he said.

“The big thing I am worried about is if they go and do predatory pricing, they will go out and sell it at a loss to send other retailers broke – that is retailers who are employing people, paying taxes.”

– AAP

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