Amazon is quietly building a supplier network for direct sales in Australia

The Sydney Amazon event, Seller Summit. Image: Supplied.

Amazon is building a strong network of suppliers and actively recruiting third party sellers so it can launch both its own retail offering and its Australian Marketplace platform at the same time.

The US-based online retailer is planning a two-pronged attack on the Australian market, including consumer electronics, and a diverse base of independent sellers using Marketplace.

The launch hasn’t been officially announced but is widely expected to be before Christmas.

Today Amazon ran an event, a Seller Summit, attended by 500 interested in selling via the soon to be launched local version of Marketplace, the third party selling platform which generates more than half Amazon’s total global revenue.

Some items have started to appear on the local Australian site but they can’t yet be ordered. The 500 who attended today’s event will be on a priority list of those to get an invitation-only to sell via Amazon Marketplace.

Later the platform will be open to automatic online sign-ups.

Retailers will have to pay a monthly fee to Amazon of $49.95 plus GST to be able to list their products on the site, but this will allow sellers to list as many products as they like.

Amazon will then take a commission, or what’s termed a referral fee, of between 6% and 15% of everything sold, depending on the product category.

The online retailer sees Australia with a lot of smaller, quality retailers who are prime candidates to use Marketplace to sell to a large buying audience. Amazon has 300 million active shopper globally.

Having an active Marketplace is a key plank in Amazon’s launch strategy. When the self-service sign-on launches, Amazon plans to offer discounts to quickly build the number of goods for sale.

The conference was told today that Amazon would launch in Australia, unlike some other markets, with both a direct retail presence and an Amazon Marketplace offering of local sellers.

Amazon country manager Rocco Braeuniger. Image: Suppleid

Industry sources said Amazon had been signing on a long list of suppliers for its own retail offering.

Amazon also will have Fulfillment by Amazon, a complete warehousing, delivery and returns service for Marketplace sellers. This won’t be ready at launch but is priority for Amazon.

Its first warehouse in Melbourne is up and running and Amazon is looking at other Australian geographic areas for more fulfillment centres.

The recently appointed Amazon Australia country head Rocco Braeuniger told the conference that the launch of both Marketplace and Amazon’s initial retail offering was “really, really close.”

“We held the Seller Summit to encourage and educate Australian businesses on how they can use Amazon Marketplace to take their products to a global audience,” says Braeuniger.

“With more than half of units sold globally coming from Marketplace sellers, we know that customers love the unique selection that they bring.

“We are excited to work with many thousands of Australian businesses to help them reach more than 300 million customers around the world and to grow their business.”

Russell Zimmerman, Executive Director of the Australian Retailers Association, told the conference that SME (small to medium enterprise) saw Amazon’s entry into Australia as an opportunity rather than a threat.

The SME Association of Australia, representing small business, was also a supporter of the Amazon conference.

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