Australian retailers aren't preparing for Amazon's arrival and many don't see it as a significant threat

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Nearly half (49%) of retailers say the arrival of US powerhouse Amazon into Australia will have no impact on their business, according to the latest industry survey.

And 30% don’t even know of Amazon’s coming entry to Australian and only 14% have plans in place for their business to compete.

Only 11% see Amazon as a significant threat. Overall, 47% believe Amazon’s entry is some form of threat but most say it isn’t significant.

Another 11% see Amazon as an opportunity for their business.

The Commonwealth Bank Retail Insights Report measures the innovation activity and performance of Australian retailers via two surveys, including one of 505 retailers.

“Many Australian retailers remain unprepared for Amazon’s arrival, or may be understating the potential impact that Amazon’s presence will have in Australia,” says Jerry Macey, CBA’s national manager retail.

“This is somewhat concerning when you consider the impact Amazon has had on the US and other very mature retail markets.”

Amazon has neither confirmed nor denied plans for Australia.

However, in November an investment fund manager quoted an Amazon staffer as saying the company aimed to “destroy” the retail environment in Australia by undercutting prices 30%.

In January, Business Insider found that Amazon is recruiting people to work on its AmazonFresh project.

Clothing and footwear retailers and those in metropolitan areas are the most likely to see Amazon as a threat, the latest survey found.

And the larger retailers, those with $10 million or more of annual revenue, were more likely to be aware of Amazon’s move into Australia.

The survey response:

Source: CBA

The research shows retailers are more likely to innovate than the average Australian business but their average return is less than half the national average.

“This reduced pay-off could be due to intense competition, which may increase even more with the expected arrival of Amazon retail here,” says Macey.

Here are the responses from the survey on the question of Amazon as a threat:

Source: CBA

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