Amazon is searching for space to build its fourth distribution centre in Mexico, according to reports from Reuters. The distribution centre, if opened, will help support the retailer’s growth in the country’s ecommerce market.

Amazon targets Queretaro…

Amazon hopes to build the distribution centre in Queretaro and has already considered several properties. The company needs 50 acres of land to build its 1.0m sq. ft warehouse and office space.

…for its suited location

Queretaro is well located, 114 miles north of Mexico City and near Queretaro Intercontinental Airport, which handles cargo. Most industrial parks in the state also sit along what is known as the ‘NAFTA highway’. This allows for the easier transport of goods from the US and Canada under the North American Free Trade Agreement.

Huge potential

Brian Huseman, Amazon’s vice president for public policy, has previously commented saying, “Mexico’s digital economy has great potential. We expect it to keep growing in the future”.

To read about how and why ecommerce is growing in Mexico, read our news story.

Amazon has introduced a new range of grocery products in Australia, under the category Pantry Food & Drinks.

Over 1,000 items available at launch

The products include a range of food and beverages, including; health foods, specialty tea, snacks and confectionery, drinks, cereals and breakfast items, cooking ingredients, rice, pasta and grains. There is also a dedicated section for Australia’s favourite brands. There are over 1,000 SKU’s available from over 400 local and international manufacturers. The launch marks the 27^th category that Amazon has introduced since entering the market in December 2017.

25% off first orders and two day prime delivery

The range appears to offer a mixture of bulk pack and single pick items, offering low prices on everyday essentials. To mark the launch Amazon is offering 25% off first orders on select pantry food and drink items, plus it also highlights that Prime members benefit from fast and free delivery within two days of orders being placed.

A matter of time before Amazon Fresh launches?

Amazon moving in pantry lines comes as no great surprise. However, doing this within a year of launch means that it has come faster than many had predicted, and it is probably only a matter of time before we see this extended further with the launch of Amazon Fresh. Amazon Australia country manager, Rocco Braeuniger, commented that the company was “delighted” to bring pantry food and drinks to Australia. Amazon Australia now stocks more than 80m products.

Casino-owned Monoprix made over 6,000 products available through Amazon’s Prime Now in September 2018. According to Casino, the partnership with Amazon has exceeded expectations and could be expanded soon.

The service has exceeded forecasts…

Monoprix made the Prime Now service available to a third of shoppers in Paris. The initial results have been “very, very satisfactory” with the number of orders exceeding original forecasts by two to three times. The Prime service has also generated between €10m and €20m since launch, which is equivalent to the food sales of a Monoprix store.

Monoprix’s CEO, Regis Schulz, hopes to expand the service across France from 2019. Schulz commented, “We are ready to follow Amazon’s deployment in all big French cities. They are likely to make the announcement when they are ready. It’s part of their plans for sure.”

…and helped Monoprix gain new customers

Schulz claims Monoprix has also gained new customers by launching on Prime Now. He notes that the retailer has reached 70% to 80% of Amazon Prime members who had not previously shopped at Monoprix.

Statements argue against some of the concerns

Schulz’s comments could be construed as being predictable, he was unlikely to comment so soon if the alliance had not proved successful. If true, with Amazon Prime not cannibalising sales from Monoprix’s own web site, the service could prove to be a success in the medium term. It would enable Casino to compete with Leclerc and others in Paris and France’s other key cities and scale its quick fulfilment option much more quickly than if it had not aligned itself with Amazon.

However, concerns will remain that Casino’s agreement with Amazon, and separately with UK-based Ocado, will not work out so positively in the longer term. Many will remain nervous over whether Monoprix shoppers will continue to buy through the company’s own web site once they have heard about Amazon Prime or other shoppers become supporters of it. Although the initial results may be positive for both sides, it remains interesting to see whether this will continue to be the case in the future.

For subscribers wanting to know more about Amazon, read our Strategic outlook for Amazon.