Amazon Takes On Coles and Woolworths

Starting from Wednesday, Amazon Australia will be introducing a selection of dry grocery products to its local marketplace, with items like tea, coffee and organic health foods expected to be among the lines available.

According to Amazon, both Australian and international branded products will be available to purchase from its website, including Aussie favourites like Milo, Uncle Tobys and Arnott’s.

“Since the launch of amazon.com.au in December of last year, we have been focused on growing selection and services for Australian customers.” Rocco Braeuniger, country manager of Amazon Australia said in the announcement.

“Today we are delighted to add to the over 80 million products already available on the store with the launch of Pantry Food and Drinks, bringing greater convenience to customers, underscored by everyday brilliant value and fast delivery.”

According to Amazon, the business is responding to the growing health food trend in Australia, which is why it has decided to include a number of health and organic food brands in its new product range.

Luke Hopkins, the co-founder and director of The Protein Bread Co., says he’s excited about Amazon’s decision to help fuel the market’s growth.

“The Protein Bread Co. is incredibly excited to be working with Amazon Australia for the launch of this new category, Pantry Food and Drinks. We’re passionate about a fitter, healthier, happier Australia and Amazon will be a pivotal partner in bringing this dream to life,” Hopkins said.

This news comes only a month after Amazon released its pet supplies category, travel store, and automotive and jewellery product ranges and is further proof the online juggernaut is showing no signs of slowing down.

Before Amazon launched in Australia, there was speculation around whether the company would bring its grocery offerings down under, posing a threat to local players, like Coles, Woolworths and IGA. In January this year, the business renewed its Whole Foods trademark in Australia but denied to comment on whether or not it had its eyes on our $100 billion grocery market.

Amazon’s purchase of Whole Foods last year indicated a change in the e-commerce giant’s way of thinking, which sent shockwaves through both the local and international grocery sectors. However, earlier thoughts on the matter indicated Coles and Woolies wouldn’t have too much to fear from Amazon’s presence, should the company enter the grocery sector. According to a report from investment bank, UBS earlier in the year, the high delivery costs in Australia and local supermarkets’ tight relationships with suppliers, when combined with their strong in-store networks would all be tough obstacles for Amazon to overcome.

Despite Amazon’s underwhelming Australian launch, however, the company has been proving as strong as ever as it slowly builds up a local presence, already rising to one of the most popular online marketplaces in the country, trailing behind the likes of eBay and Gumtree.

While Amazon is only launching a range of pantry goods at the moment, if anything is to be taken from the company’s commitment to groceries in the US, it could only be a matter of time before it ramps up its local grocery investments.

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