Digital technology has done a tremendous impact on consumers’ shopping behaviors. Consumers can search for the product and compare the price online easily, even they can also change the retailers with one mouse click. Along with the digital technology, e-commerce has become the essential role for both developed and developing countries. The e-commerce dramatically diversifies the opportunities for businesses such as enhanced the customers relationship, reduction in cost and efficient processes (Terzia 2011). These can be an advantage for Amazon to launch their operations in Australia, but it could be the disadvantage for them since some customers are not likely to shop online.
Amazon is the most enormous online store which was founded in Washington, United States by the current CEO Jeffrey Preston Jorgensen in 1994. Amazon aimed to serve consumers with the best quality products and services in the most convenient way (Scheider 2018). Since Australia has a stable economic growth, low unemployment rate and high living standard, there will be the opportunity for Amazon to launch their operations (Lydon, Dyer and Bradley 2014).
The Australian market has to face competitive price and product range when Amazon operates in Australia. With the e-commerce, customers are likely to search for the product and compare the price online. They will choose the comodity with high quality product and reasonable price. It is not a big matter for Amazon since it has experienced in USA. Most of the time, Amazon provides cheaper price and higher quality products than brick and mortar retailers do (Xu, Gao and Hammond 2017). In addition, in order to compete with existing brick and mortar business, Amazon keep diversifying their products and services range to satisfy the need of customers as well as make sure that the products are always available when the customer orders (Xu, Gao and Hammond 2017).
Due to the advancement in e-commerce, there are a consideration of online shoppes in Australia. This could be another competitive factor that Australian retailers have to encounter. In Australia, there is approximately 50.3% of online businesses (Xu, Gao and Hammond 2017). Amazon is extremely good at the e-services since they continue innovating the Amazon Prime. Amazon Prime allows free two days shipping for a lot of products and free same day delivery for customers (Robischon 2017). Moreover, the Amazon Prime is expanded into 49 cities in 7 countries (Robischon 2017). So as to compete against the Amazon company, the Australia should consider to enhance, innovate the e-services as well as ship the goods faster than Amazon does.
Besides, the benefits that Amazon brings to Australia, there are some negative factors that challenge Amazon’s operations.
The first challenge that Australia has to overcome are logistic and delivery cost (Xu, Gao and Hammond 2017). Since Australia is a large country with small population, the delivery cost will be high. Also, not only the high delivery cost but also the slow shipping. To demonstrate, some people may live in the remote area in Australia and they cannot receive their product on time. Lazy logistic can also be the disadvantage for Amazon. Therefore, to overcome this disadvantage, Amazon should try to improve their logistic and delivery time to make sure that their customers may receive the fast shipping with reasonable delivery cost. HYPERLINK “https://www.reuters.com/article/us-australia-amazon-com/amazon-takes-on-delivery-challenge-for-australian-merchants-idUSKCN1GA2WK” https://www.reuters.com/article/us-australia-amazon-com/amazon-takes-on-delivery-challenge-for-australian-merchants-idUSKCN1GA2WK
In addition, competing with click and mortar businesses will be the next challenge for Amazon. Click and mortar businesses are the companies that have both online and physical store. These days, some consumers are trying to avoid the online market because they desire to touch or try the goods before making purchase decision. Also, they are afraid of the error transactions when using credit card as well as the quality of the products (Xu, Gao and Hammond 2017). In this case, Amazon should consider to operate some physical stores in Australia for customers who do not adopt to shopping online. By doing that, Amazon can not only increase the number of customers but also enhance the interaction with consumers (Xu, Gao and Hammond 2017).
In the past few year, on the way to enhance the efficient manufacturing processes, businesses had encountered some challenges (Mariungo et al. 2017). By applying the new trend which is industry 4.0, companies can achieve the intelligent manufacturing process. In 2011, the concept “industry 4.0” was first released by German government for the high-tech strategy in 2020 (Zhou, Liu and Zhou 2015). Industry 4.0 aimed at building a highly complex and flexible system in order to increase the interaction between customers, products and devices during the production process (Zhou, Liu and Zhou 2015). Additionally, the industry 4.0 process consists of automation technology, computer and digital manufacturing technology (Zhou, Liu and Zhou 2015).
The new term “smart factory” is the predominant element in industry 4.0 which concentrates on the implementation of networked distributed production facilities and intelligent manufacturing (Zhou, Liu and Zhou 2015). In order to have better services to meet the customers’ satisfaction, the smart factory is not only concerned about the interaction between human-computer but also interaction between things and things (Zhou, Liu and Zhou 2015). Moreover, smart factory also consolidates the industrial partners and non-industrial partners for a greater organization (Hozdic? 2015).
By the trend of automation, industry 4.0 will support considerable technologies for manufacturing companies to improve their operations. The first technology that industry 4.0 can support the process is Cyber-Physical Production System (CPPS). Cyber-Physical System (CPS) is the platform for the development of CPPS. Cyber-Physical System has a strong connection with industry 4.0, Internet of Things (IoT) and Machine to Machine (M2M). The CPS concept was defined as the integration of logistics, warehousing system and social requirements to create a global value network (Mariungo et al. 2017). Thanks to the advancement of IoT, it allows CPPS to optimize the production process as well as strategic advantages so as to be more sustainable in the industrial process (Mariungo et al. 2017). By utilizing CPPS to combine the virtual space with the physical world, it allows smart factory to have more brilliant to produce more production conditions and smart conditions. Due to the significant advancement of CPPS technology, it will improve the ability to interact of computing power, communication and control mechanism. In addition, the system enables the feedback loops to support for their decision making. Also, the cyber system is able to convert the physical data into digital signal. By doing so, they can share the available information through system to system in digital network
Robischon, Noah. 2017. “Why Amazon Is The World’s Most Innovative Company Of 2017.” Fast Company. https://www.fastcompany.com/3067455/why-amazon-is-the-worlds-most-innovative-company-of-2017
Lydon, John, David Dyer, and Chris Bradley. 2014. “Compete to Prosper: Improving Australia’s global competitiveness.” McKinsey Australia. file:///Users/julietran/Downloads/McKinsey_Compete_to_Prosper_Improving_Australias_Global_Competitiveness_FINAL_28.7.2014.pdf
Scheider, Laura. 2018. “Overview of Amazon.com’s History and Workplace Culture.” The Balance. https://www.thebalance.com/amazon-com-company-research-2071316Terzia, Nuray. 2011. “The impact of e-commerce on international trade and employment.” Procedia Social and Behavioral Sciences 24 (2011): 745-753. https://fardapaper.ir/mohavaha/uploads/2017/10/The-impact-of-e-commerce-on-international-trade-and-employment.pdfXu, Jun, Xiangzhu Gao, and John Hammond. 2017. “E-tailing in Australia: A preliminary analysis of David Jones. The International Technology Management Review 6(4): 149-157.