Amazon Is Opening A Huge Warehouse In Melbourne

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Amazon's Australian retail offering is kicking off with a 24,000 square metre fulfillment centre in Melbourne's Dandenong South.

Amazon confirmed in a statement this morning the fulfillment centre will be in the Pellicano M2 Industry Park - promising easy access to the South Gippsland Highway, Monash Highway and Eastlink.

The retailer is recruiting for "hundreds of new jobs" including operations managers, pickers, packers, systems technicians, and HR specialists.

"We are thrilled to be creating hundreds of new roles in Dandenong South," said Robert Bruce, Amazon's Director of Operations for Australia.

"This is just the start. 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."

Bruce says the new fulfilment centre will stock "hundreds of thousands of products" for delivery across the country once the retail store is launched.

A recent survey showed that a massive 90 per cent of us online shopping-types will use the service - if it comes good with the low prices, vast selection and fast delivery we've been promised, of course.

Expert analysis of the impact Amazon will have on Australian retail predicted a shocking result within the first five years we're talking major losses for JB Hi-Fi, Myer and Harvey Norman.

The figures are so damning that Harvey Norman may have already lost market value in part based on the analysis, with Gerry Harvey taking a $100 million hit to his personal wealth.


    The beginning of the end for Aussie retail

      No, the end has already happened. This just finally turns the life support off what is effectively brain dead.

      Aussie retail needs the kick in the arse to get it to where it should be by now. Retailers like Hardly Normal etc. have been gouging us from the start.

        Have you actually gone outside Australia and bought electronics or white goods? Europe, Dubai, and South America (places I have actually visited and purchased from) are all more expensive than what we buy here, I've looked at TV's, fridges, washing machines, coffee machines even, and headphones. Clothing and Food are a different story.

          removed for brevity
          waited too long for the comment edit to be moderated, again!.

          Last edited 03/08/17 3:02 pm

          Aren't all those countries, in their own various ways, also very expensive to live in anyway? I would have thought electronics would naturally be more expensive in those places. None of which changes the fact that our electronics dealers have been overcharging like thieves for years. And if you don't think that's fair comment, then you're going to hate Amazon's sales model, Our current dealers will either adapt or go under.

          waited too long for the comment edit to be moderated, again!

          Also, the downvote was a miss click, I don't agree with your comment so I left as negative but really was just a miss click.

            commenting hard? are you new to interwebs? ;)

    I'll be interested to see how they can keep their prices low given the workers' rights here. I mean even those pesky casual contractors that Amazon loves so much have rights here.

      Automation will be the key. The British Library has a mechanical book handling service that can deliver any one of the 150 million items in its collections to the reading rooms without needing human intervention. Driverless road trains are going to appear inside the next decade. Heck, Amazon might even test drone parcel-drops here since our gun laws mean there's less risk of them being sniped out of the sky (nobody tell them about the wedge-tailed eagles).

      They're talking a big game about job creation and I don't doubt it, but they've waited this long to come here for a reason, and that's because the sheer number of staff to pull it off is going to be a fraction of what they would have needed five years ago.

        This man is on the money. Amazon's operation here will have minimal staff - most operations, including shelf re-stocking, item collection and packaging, will be heavily automated. I'd expect a total staff of around 15 people for the entire warehouse operation.

        This is an expensive up-front cost, but the cost of labour would quickly out-weigh it over time.

        Last edited 03/08/17 11:27 am

      Not only the automation side of things as Unity said, but Amazon do deals with producers/suppliers that Australian owned companies can't because they simply don't have the huge cashflow Amazon have.
      They also don't have a retail presence, so save shitloads on not having to pay Australia's ridiculous rental prices, nor do they have to worry about advertising to the degree the existing stores do.

      This is the interesting part. But I'd assume Amazon did their research before deciding to open up in Australia and still thought it worthwhile to move ahead.

      So I can only assume they'll push the borders on minimum wage as well as buying stock in massive amounts to get those prices down. Then try and get as many Prime members as possible to make up the difference.

        Remember they've been operating in Germany, France, Japan, and the UK for many years, all of which have much stronger wage laws than the US. I wouldn't doubt for a moment they've considered Australian laws too.

      I suspect that Amazon will be able to neatly undercut most Australian retailers purely because of the scale of their operations. Even if they follow Australian workers' rights laws to the letter, it seems like they'd be able to reduce costs in a lot of other places that most Australian retailers currently don't/can't.

      What I'm really interested in is what Amazon Prime will look like in Australia. In terms of population spread, Australia is very different to any country that Amazon currently operates in.

      Last edited 03/08/17 3:25 pm

        Population spread is a key factor, however the USA is the same size as Oz so i see no difference in terms of delivery times +/- a couple of days. But considering i was able to purchase something from Amazon and get it delivered to my door quicker than i was from an Australian company i dont see there being too much of an issue.

          Yes, the Amazon Prime offering is key.

          Our population spread is very similar to Canada and as I understand it, Amazon has really struggled to succeed in Canada, because of that.

      Even if (say) the cost of worker rights is removed from the equation, Amazon will still be fine.

      What the local retailers have that Amazon doesn't is hyper-inflated mark ups. Most of the cost has little to do with worker rights and the cost to do business.

      Just look at local retail that has started to drop the prices. They prices may have come down a little but at the same time there are a lot less customer facing staff.

      Rather than reduce the markup to a reasonable about (say, 20% instead of 350% - being hyperbolic here) the staff needed to run the business are sacked.

      Not to get too far off topic but it's also the reason I don't go to my local cinema anymore. They offer $10 tickets but during my last visit I found this was done by virtually laying off all the cleaning staff.

      Went to leave and though I had stepped in gum. Nope. The grime in the carpet had built up to where said carpet was not becoming adhesive. Yuck!

    Good time to become a postie

    As an organization it will increase their revenue but on the other hand it will increase the competition among the local business owners because Amazon is a huge brand that attracts people.

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