Amazon launches Prime Now in Singapore

By RJ Whitehead

- Last updated on GMT

© iStock
© iStock

Related tags: Singapore

Amazon looks set to shake up Singapore’s retail market with the launch of its most aggressive service yet, Prime Now. 

The retailer will offer two-hour delivery on tens of thousands of products in its ninth market. The service will be free for orders over S$40 (US$29), and Amazon will also offer a one-hour expedited delivery service for S$9.99 per shipment.

It will operate from a 100,000 square-feet urban fulfilment centre—the biggest in its network.

Rumours of the American giant’s arrival have been circulating since the start of this year.

Amazon’s entry into Southeast Asia is expected to spark fierce competition with Alibaba, which owns regional e-commerce platform Lazada, and is said to be considering an investment in Indonesia’s Tokopedia.

The region is home to an e-commerce market forecast to reach US$88bn by 2025, according to a report by Google and Temasek Holdings.

Though online retail accounts for only a small portion of Singapore’s grocery market, with a 1.2% share, IGD predicts this will grow to 4% by 2020, with sales set to reach S$500m.

Shirley Zhu, of the food and grocery researcher’s Singapore office, said the city-state has all the ingredients that Amazon looks for in a market.

Singapore has affluent consumers with busy lifestyles, a big expat population and high internet penetration. It is also the gateway to Southeast Asia’s 600 million consumers. Shoppers here also tend to be very open to innovation, all of which make this a very attractive market and a huge opportunity for a retailer like Amazon​,” she said.

The e-commerce major aims to supply more than 20,000 unique items to the Singapore market through its app, covering categories from groceries and household essentials to electronics products and toys. Frozen meat and seafood and chilled beverages will also be available.

This will be the first time that Amazon has introduced Prime Now before its flagship offering, Prime. The service is usually exclusive to members of Amazon Prime, but will be available to Singaporean shoppers that don't have a Prime membership for a limited period.

It remains to be seen how successful Amazon’s launch will be, but one thing’s for sure: in online grocery, Singapore’s shoppers are benefiting from more options, cheaper prices and faster deliveries than they ever have before​,” Zhu added.

Related topics: Business, South East Asia, Supply chain

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