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Amazon Launches Business Platform in Australia
Online retail leader Amazon has today introduced Amazon Business, a new B2B (business-to-business) platform aimed at enhancing its presence in the Australian retail landscape. The company claims this new service will enable businesses to achieve significant cost savings by offering access to a vast catalogue of products.
Originally launched in the U.S. a decade ago, Amazon Business has expanded into 11 countries, and now caters to over eight million customers globally. Lena Zak, Amazon Business Australia’s country manager, highlighted the demand for such a service in Australia, noting, “I really don’t think that anybody else can offer what we offer. We have millions of products on Amazon that really aren’t available anywhere else."
Key Features of Amazon Business
The B2B store promises to deliver a familiar shopping experience for existing Amazon customers, coupled with features tailored specifically for businesses. These include:
- Business-only pricing and quantity discounts.
- A diverse selection of products, from office supplies to tools, electronics, and cleaning items.
Zak elaborated on the advantages, indicating that businesses can conveniently source everything from stationery to pantry essentials from a single location. “Without us, they would have to visit multiple stores to get all their needs met,” she remarked.
Addressing Rising Costs for Australian Businesses
Recent research commissioned by Amazon Australia via YouGov revealed that 92% of small and medium businesses have faced rising operational costs over the past three years, with 79% expressing concern over increasingly expensive goods. Zak emphasised that Amazon Business aims to alleviate some of this financial burden by providing affordability on everyday products as well as leveraging the convenience of online shopping paired with fast delivery options.
Competitive Pricing Example
Zak provided examples of financial savings through Amazon Business. A HPM Standard 4 Outlet Powerboard retails for $5.25 on Amazon, compared to $7 at Officeworks. Additionally, a 1-kilogram bag of DeLonghi signature blend coffee beans is priced at $26.64 on Amazon, lower than the $29 offered by competitors like The Good Guys and JB Hi-Fi.
Amazon’s Growing Influence in the E-commerce Domain
Amazon has increasingly become a formidable player in Australia’s e-commerce sector, having launched its local retail store in 2017 and invested around $15 billion in the region since 2011. Last year, the company reported local revenues of $7.7 billion, reflecting a 20% increase year-on-year. Revenues from its e-commerce segment alone rose by 23% to $3.8 billion, while subscriptions to its Prime service saw a 39% rise, generating $480.4 million.
A December analysis by Goldman Sachs ranked Amazon as the second-largest online retailer by sales in Australia, tailing only Woolworths but surpassing competitors like Coles, Officeworks, and JB Hi-Fi. The supermarket chains recognise Amazon as a serious rival; Woolworths’ CEO highlighted that Amazon holds 40% of their product range in categories including groceries and personal care. Meanwhile, Coles’ leader claimed that Amazon could significantly disrupt their existing business model.
Growing Customer Base
In 2023, Roy Morgan reported that Amazon Australia has a growing customer base of 7.9 million, bolstered by an influx of 1.1 million new customers over the past year.
Conclusion
As Amazon Business debuts in Australia, it promises to reshape the purchasing landscape for businesses by not only offering variety and savings but also simplifying the procurement process. With rising costs affecting Australian small and medium enterprises, this new platform could provide essential relief and convenience, potentially enhancing Amazon’s already significant presence in the market.
