Amazon is playing “catch-up” with its Australian same-day delivery plans, says Zoom2U CEO

Amazon has revealed plans to establish same-day delivery services in Sydney and Melbourne, a move one logistics leader described as “playing catch-up” to existing market players.

Speaking at The Australian‘s e-commerce summit on Thursday, Craig Fuller, Amazon’s chief of Australian operations, said the company aims to launch the service in Sydney and Melbourne.

Under the plan, Amazon customers who place an order before 11am could receive their delivery by nightfall that day.

The company will leverage its six national fulfilment centres and more than a dozen delivery stations for those deliveries, and is expected to lean on independent contractors working through Amazon Flex to send those goods home.

Amazon launched its same-day delivery service in the select US cities in 2019. It has expanded across the country since, and into major international markets including the UK.

Amazon same-day delivery is likely to face a warm response from Australian consumers, whose online shopping habits have only grown in value and volume over the past two years.

But Steve Orenstein, CEO of ASX-listed Zoom2U, said Amazon will offer a service already available to many Australian businesses and consumers.

“I think it’s a positive thing, it’s great that they’re doing it,” Orenstein said, even if “a number of companies in the market already do same-day delivery [as] this is what consumers are looking for”.

Domestic competitors offering same-day delivery can serve customers differently, he added.

Unlike Amazon, which processes deliveries from warehouses and delivery centres, Zoom2U often facilitates deliveries from brick-and-mortar stores to end consumers.

Orenstein said this model gives smaller players an advantage, as businesses can “leverage their retail footprint” instead of working through the Amazon ecosystem.

Stores can operate as “micro-warehouses”, he said. “That allows them to be really close to the consumer, and to be able to do an even faster delivery because the delivery system is really short.”

While Amazon plans its rapid delivery operations, ‘instant commerce’ operations like Milkrun are also pushing for the same-day delivery, and often same-hour delivery, of everyday grocery items.

As retailers adjust to new consumer expectations — and organised labour groups negotiate fair working conditions for drivers — Orenstein said Amazon’s announcement comes at an “exciting time” for Australian retail.

“Products are going to be able to get to you much much faster than what you’ve ever had,” he said.