Amazon Australia opened as a general online store this morning with the news that shipping would be free for orders over $49.
For a long time, Australians have purchased goods from Amazon US and the retail giant is so used to this practice that it has a page specifically devoted to show the delivery costs for shipping from North America to Australia.
But the new local Amazon business will deliver out of its Melbourne fulfillment centre – the term the company uses for its warehouses – and it’s believed that a Sydney depot is currently under preparation.
So how do the Amazon Australia fees compare to Amazon US? The good news is the new local site will save Australians a whole lot of money.
Firstly, these are the delivery costs on Amazon Australia:
The biggest difference is that while Amazon Australia offers a free delivery option regardless of destination, there are no such zero-fee options to ship from Amazon US to any Australian destination.
Amazon Australia also doesn’t double charge — Amazon US, for Australian addresses, charges both “per shipment” and “per item” fees. The US store also levies a surcharge for “heavy or bulky media”, from about $4 per kilogram.
And of course, delivery times are a massive advantage with the new Amazon Australia site.
Standard shipping, for example, takes 3 to 7 business days for major cities from the local site, while delivery from the US store takes 9 to 12 days. Even priority shipping takes 2 to 5 workdays from the US, while the Australian site will have the package to you in one business day if you’re in a mainland capital.
Amazon Prime is not in Australia… yet
An additional issue to consider is that, in the US, Amazon runs a subscription programme called Amazon Prime, which provides customers with unlimited 2-day shipping, streaming entertainment and e-books for $US99 annually or $US10.99 monthly.
Amazon Australia will be running its own version of Prime but it is not currently available. The company stated it would be launched middle of next year, and is already taking registrations from interested customers.
In a pre-emptive strike, Australia Post launched its Shipster subscription program in October, which allows free delivery from more than 50 local retailers — including Myer, Target, Harvey Norman, Booktopia, Cotton On and Showpo.
That service costs $6.95 per month, with all orders $25 and over eligible for the free shipping.
Industry experts told Business Insider last month that delivery costs and times would be the biggest challenge for Amazon Australia, citing the country’s vast distances and sparse population.
“Fulfillment costs will be higher, as the brand will have fewer centres initially. Building its ‘Fulfillment by Amazon’ service may result in a slow start for the giant and there is still the potential for unseen repercussions relating to fulfillment in the world’s sixth largest country [in area],” said OFX partnership manager Ed Wiley.
IBISWorld senior industry analyst Kim Do correctly predicted that Amazon Prime would not be available at the launch of the Australian site.
“Australia’s large geographical size and dispersed population will lead to higher distribution costs compared with Amazon’s home market in the United States. This is likely to limit the company’s ability to offer Amazon Prime Shipping services in the short to medium term,” Do said last month.
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