Amazon picks its first Australian warehouse, a step towards launching

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SYDNEY (Reuters) – U.S. retail giant unveiled the location of its first warehouse in Australia on Thursday, picking an industrial area outside Melbourne in a major step towards launching operations in the world’s 12th-largest economy.

Australians can already buy Amazon products from offshore, but the prospect of an Amazon warehouse adds to pressure on traditional brick-and-mortar retailers to protect already-fragile sales.

The Seattle-based retailer confirmed plans to bring its online shopfront service, Amazon Marketplace, to Australia in April, without saying when it would begin the service or where it would locate its warehouses in the vast country.

It has not said when it will start the service in Australia, nor which freight service it will hire. Amazon Marketplace charges retailers to advertise on the Amazon website and use Amazon’s warehouse and freight networks.

“This is just the start,” said Robert Bruce, Amazon’s director of operations for Australia, in a statement.

“Over time, we will bring thousands of new jobs to Australia and millions of dollars of investment as well as opening up the opportunity for thousands of Australian businesses to sell at home and abroad through Amazon Marketplace.”

Bruce added that the warehouse, about 42 kms (26 miles) from Melbourne, would stock “hundreds of thousands of products which will be available for delivery to customers across Australia”.

Freight companies in Australia face the challenge of serving a country of only 24 million people spread across a continent nearly the size of the United States.

But with four-fifths of the population housed on the east coast, Melbourne or the larger city of Sydney were obvious choices for Amazon’s first warehouse.

Reporting by Byron Kaye; Editing by Stephen Coates