Amazon, Alibaba and your business
Representing a combined US$159 billion annual worldwide revenue, the arrival of Amazon and AliBaba in Australia comes with some great opportunities for Australian businesses.
Expand your reach with Alibaba
Having recently opened a headquarters in Australia, international powerhouse AliBaba is now offering Australian businesses an online business-to-business marketplace with global reach.
"A physical Alibaba headquarters is a key step in ensuring Australian businesses have the support and information they need to succeed in China and the rest of the world," says founder and CEO Jack Ma.
Ma believes that global trade can be reshaped to become more inclusive of small and medium businesses. A belief reflected in the fact that AliBaba gives users up to 190 countries to expand into, allowing small businesses to compete against big exporters on a level playing field, cherrypicking where their products may be unique and therefore highly sought after.
AliBaba take a percentage of every sale made on the site and sell marketing packages to their users. All other profits go back to the seller.
While AliBaba gives small and medium businesses the power to export, they also represent a growing level of competition. Savvy business owners should look for opportunities within the company’s framework, and exploit the site's various marketing options to promote their goods.
Make Amazon's customers yours too
Having already secured a 24,000m2 space in outer Melbourne, Amazon’s arrival brings with it opportunities that are equally impressive.
In the US, 43% of all online sales go through the site. In Australia, they have already secured $1 billion in revenues (FY2016-17), making them a household name. The interest for small and medium businesses lies in a part of the site called the Amazon 'marketplace'.
Representing around half of Amazon's sales in the US, the 'marketplace' could be a world of opportunity for enterprising business people. Amazon reports that over 500 Australian businesses have already signed up to the service and they’re currently looking for more.
While Amazon remain tight lipped around their sales and marketing strategy, they are expected to employ a similar strategy in Australia as in Spain. The brand have deep pockets, and are likely to spend hundreds of millions on marketing. Potentially meaning added exposure for some early adoptors of the service.
Amazon charge between 6 and 15 per cent for every sale made on their site, as well as a $49.95 monthly fee. Merchants can choose Amazon’s postal service or take care of shipping themselves and keep the difference.
Embrace the opportunities
For Australian businesses, the arrival of Amazon and AliBaba represents big opportunities. If you can embrace them by finding your business' niche within their framework, you can reach new markets and increase your businesses profitability; surely an exciting prospect for any business.