Tech titan Amazon launches its business-to-business product that tackles soaring costs

Amazon Business has been launched in 10 countries and now it’s Australia’s turn as the tech behemoth Amazon unveils a division designed to help small businesses cope with operating costs.

Lena Zak, country manager Amazon Business, says the Business Prime offering has the shipping benefits of consumer Prime while helping streamline procurement, reduce costs and increase productivity.

Amazon Australia has launched a new business-to-business division that it says is designed to help small and medium-sized enterprises better cope with soaring operating costs, offering bulk discounts and access to smarter purchasing tools.

A cost crunch on Australian businesses has worsened after the Fair Work Commission awarded an above-inflation 3.5 per cent pay rise to more than three million workers last week, sparking calls for the federal government to urgently address flatlining productivity growth.

The restaurant sector said it would likely have to raise menu prices when the higher labour costs begin on July 1, although Prime Minister Anthony Albanese has dismissed this claim saying the decision would ensure workers “don’t fall behind when it comes to the cost of living”.

But research from Amazon Australia and YouGov has revealed the vast majority of businesses are concerned about surging operating costs and have had no choice but to pass on these costs to customers.

Amazon has followed Samsung by launching a new division that is dedicated to serving business customers. But Amazon has historically shared its technology with enterprise customers, most notably Amazon Web Services which has helped other companies build online stores and scale up IT infrastructure.

Amazon Business Australia country manager Lena Zak said the new division would help ease rising operating costs by offering business-only pricing and quantity discounts, and a new Business Prime product that is similar to its consumer Prime that has free shipping and other benefits via an annual subscription.

“Amazon Australia is excited to support Australian businesses and organisations of all sizes with simplifying a critical aspect of their operations, so they can focus on what’s most important to them: serving their own customers better, while growing their organisations,” Ms Zak said.

Amazon and YouGov surveyed the owners and senior decision makers of 513 small and medium-sized businesses and found 79 per cent were most concerned about rising operating costs. Of those who responded, 83 per cent said they had no choice but to pass these costs on to their customers.

A separate survey by Commonwealth Bank earlier this year found that more than a quarter of Australian small business owners didn’t pay themselves a salary or used personal savings to help with cashflow problems in the past 12 months.

“As operating costs keep rising, Amazon Business can help take some of that pressure off by offering meaningful savings on everyday goods and supplies, along with the convenience and simplicity of our delivery experience,” Ms Zak said.

“Amazon Australia has significantly invested in and expanded its operations network to enable a seamless, faster and more reliable shopping experience for customers, and we are thrilled to now be offering that to business customers.

“We know this will be particularly beneficial for the millions of SMBs who operate across the country.”

Gold Coast business owners Sylvia Numrich and Holger “Bruce” Numrich. Amazon Australia has launched a new business-to-business division. Picture: Glenn hampson

Ms Zak said Business Prime combined the shipping benefits that consumer Prime members enjoyed, while helping SMBs “streamline procurement, reduce costs and increase productivity”.

It has “guided buying”, which allows organisations to direct employees to preferred

products and suppliers while restricting access to others, helping to enforce purchasing policies, control spending and maintain compliance across their organisation.

“So if you think of a daycare for example, in addition to stationery and computer equipment, and so on, they’ll also have a staff kitchen and need pantry items, coffee pods, and cleaning products. They’re probably also buying nappies, and formula and toys,” Ms Zak said.

“Previously they may have had to visit multiple stores to get everything they needed – a stationery store, a supermarket, and a toy store. But now, with the launch of Amazon Business, they can get all of that in one place, delivered fast and free, and with exclusive business discounts.”

Ms Zak said the program was integrated into the Amazon Climate Pledge – the commitment to reach net zero emissions across its global operations by 2040.

“We make it easy for companies to identify and purchase more sustainable products. This program highlights items that meet third-party sustainability certifications, helping businesses reduce their environmental impact without compromising on quality,” she said.

The program will support Amazon’s third party sellers on its market place by featuring their products on the company’s new B2B store. A business can then decide whether to use “fulfilment by Amazon”, which stores and ships their products to customers.

Amazon Business has already been launched in 10 countries, including the US, UK, Japan, France and India.

Originally published as Tech titan Amazon launches its business-to-business product that tackles soaring costs