The outlook for the resources, retail and banking sectors
Roger Montgomery is the Founder and Chairman of Montgomery Investment Management. Roger has over three decades of experience in funds management and related activities, including equities analysis, equity and derivatives strategy, trading and stockbroking. Prior to establishing Montgomery, Roger held positions at Ord Minnett Jardine Fleming, BT (Australia) Limited and Merrill Lynch.
This post was contributed by a representative of Montgomery Investment Management Pty Limited (AFSL No. 354564). The principal purpose of this post is to provide factual information and not provide financial product advice. Additionally, the information provided is not intended to provide any recommendation or opinion about any financial product. Any commentary and statements of opinion however may contain general advice only that is prepared without taking into account your personal objectives, financial circumstances or needs. Because of this, before acting on any of the information provided, you should always consider its appropriateness in light of your personal objectives, financial circumstances and needs and should consider seeking independent advice from a financial advisor if necessary before making any decisions. This post specifically excludes personal advice.
Nick Ogle
:
Roger, another great video. I’ve heard you speak on Amazon a couple of times now. I have a question re Amazon that I have not heard you cover yet.
Firstly a disclaimer, I know a little about the mechanics about Amazon as I’m in the process of Private Labelling products into their American Marketplace.
My question is, instead of complaining about Amazon entering Australia why don’t established retailers here embrace the concept & join the party?
No retailer will every be able to compete with the Inventory, delivery & purchasing efficiencies that Amazon already deliver into their marketplaces in the USA, Canada, Mexico, Japan, India, China, Germany, Spain, France, Italy & the UK. The only possible exception might be Alibaba in Asia.
Amazon have a program called FBA – Fulfilled by Amazon. If you can deliver goods to their collection centres (there are 60 or so in the States), then Amazon handle every thing in the middle. The only thing the Brand has to do is to ensure that their product headlines, description & photos are presented professionally & are optimised for the Amazon Search Engine. Depending upon how competitive the segment you are selling in is then you may also need to use Amazon PPC (Pay per Click) Ads to get yourself on the front page. Its worth noting that estimates are that over 40% of ecommerce searches are now conducted on Amazon not Google! Once the Amazon customers order your product then Amazon handles all shipping, customer complains & collection of the money. Brands get paid automatically twice per month.
If you look at the US amazon marketplace many established brands are selling there & competing with Private Label sellers.
I would also add that depending upon the agreements local retailers have with their suppliers then there is also, via Amazon, another opportunity staring them in the face. That is Australia has only 23M people. With Amazon you can get access to approx 793M people by only delivering to two of their collection Centres – USA (Covers USA, Canada & Mexican markets) & UK (covers UK, Spanish, German, Italian & French markets)
Let me know your thoughts
regards
nick