Global Giant Amazon Begins Operations in Australia


Amazon, the world’s largest online retailer, began operating its fulfilment centre in Melbourne last December as part of its on-going global expansion program. The global online giant’s entry into Australia’s retail horizon is expected to affect sales of several well-known rival retailers which have had a monopolistic control on the industry.

Financial services provider Morgan Stanley estimates that Amazon’s entry would result in a $1.2 Billion drop in the sales of Harvey Norman, JB Hi-Fi and Wesfarmers.

UBS fund managers project Amazon’s operations would slice sales figures of its rivals by 5.2% over the next 3 to 5 years and earnings reduced by 16%. Market analysts believe the electronics segment will bear the brunt of Amazon’s retailing power. JB Hi-Fi’s earnings are expected to decline by 33%.

The Labor Party government in Victoria lauded the decision of Amazon to establish its fulfilment centre in Melbourne instead of Sydney. Wade Noonan, Industry Minister believes Amazon’s entry would open up greater opportunities for local businesses.

A number of prominent business figures in Australia like electronics retailer Dick Smith have responded to Amazon’s arrival in Australia by stroking the flames of nationalism:

“It is extreme capitalism. Amazon will make a fortune and take hundreds of millions of dollars out of this country and send it back to the United States. As it gets greedier there is no doubt in my mind they will do well. All of the money will not stay here, like from Harvey Norman, or JB Hi-Fi, the money will go back to the United States.”

Amazon has a poor reputation for maintaining appalling work conditions in their warehouses. There have been reports that working conditions in Amazon’s warehouses have been less than ideal with physically demanding work, minimal breaks for food and rest plus temperatures that soar into dangerously hot and humid levels. In the United States and Europe, Amazon has been embroiled in cases involving multiple workplace injuries and deaths.

Thus there are reasons to believe that conditions will not change in Amazon’s 24,000 square meter fulfilment centre in Dandenong South which is largely immigrant and working class.

Job posts already list work expectations that include “physical warehouse activities” requiring “lifting and moving material up to 16kg each” and “standing and walking for up to 10-12 hours a day.”

National Union of Workers (NUW) national secretary Tim Kennedy sought dialogue from Amazon but did not hear from them.

NUW’s plans for Amazon are supported by the pseudo- left group, Socialist Alternative as it does with the union’s activities with other Melbourne- based warehouses.

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