Australia’s biggest online retailer is planning to raise its minimum price of $49.99 for its online orders by an extra $1.50 on July 1.
The move follows a wave of price hikes across the country this year, with the price of online goods soaring from $19.99 a year ago to $59.99.
But the company has said it is not looking to increase its prices because it is confident it will be able to raise the cash in the next few months to offset any increases in costs.
“We are seeing a lot of pressure from our customers and customers are looking to pay more for goods that they don’t need,” Amazon Australia’s chief financial officer, Michael Breen, said.
“It’s a bit like a coin drop in the sky but we have been in the game for a long time and we know that when it comes to the future, the sky is not falling.”
There is no doubt that we need to raise prices to be able offset any increase in costs.
“Amazon has long faced a challenge to its business model, as it struggles to sell more goods in Australia due to the country’s tight online laws.”
The reality is that if you want to have a long term business you have to have some kind of structure that lets you pay more money to have more money back, or that can be in the form of lower prices,” Mr Breen said.”[And] that’s something we are still trying to do and I’m confident that in the future we will be successful.
“A spokesperson for Amazon Australia said the company was taking a “slight” step in the right direction to raise more money from its customers, but it would need to continue to do so.”
Our goal is to be as profitable as possible in the long term, but we’re also constantly working to improve our service and pricing structure to keep customers happy and make our business even more successful,” the spokesperson said.
Amazon has also recently raised prices for many of its products, including books and clothing, to support its expanding distribution network in the country.