Some small business are looking forward to Amazon's arrival in Australia

Flemington market in Sydney. Saeed Khan/AFP/Getty Images

Small businesses are divided by the prospect of big overseas players such as Amazon disrupting Australian retailing.

The latest SME Snapshot survey from MYOB finds that more than a quarter (27%) are concerned about encroaching overseas competitors.

But another 26% are feeling positive about the arrival of these competitors.

Amazon is expected to be fully operational, including fresh food and groceries, in Australia by the end of 2018.

The majority of products listed on Amazon involve third-party sellers via its Market Place platform, creating an opportunity for smaller businesses.

According to analysis by Credit Suisse: “Market Place provides an effective channel for smaller sellers that otherwise face significant scale barriers.”

The research shows bigger players such as Myer will be impacted most. Amazon will likely reach a better than 5% market share in many retail categories within five years of arriving in Australia.

Tim Reed, the CEO of MYOB, says nervousness among small businesses about overseas competitors can be put down to the unknown.

“Our SME community is extremely resilient — the proof being their strength in the face of constant changes to our market,” he says.

“While there is some hesitation around new players to the market, business owners will need to assess the impact once they have arrived, and as they have always done — adapt to this change in order to remain commercially competitive.”

A majority of SMEs (57%) believe additional overseas businesses in the local market will force them innovate.

But many believe the key impact will be the loss of customers (43%) or revenue (43%).

“Australia has been tipped for the launch of a number of overseas retail outlets this year and our business owners are telling us they’re not sure how the advent of these newcomers will play out in the market,” Reed says.

“It is heartening to see they’re thinking proactively about this, and as usual — looking to rise to the occasion and meet greater competition in the market via innovation.

“However, the findings show us that there is still a ways to go to settle concerns around customer and revenue impact, especially given the wider global environment they’re now playing in.”

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