Canadian grocery stores and retailers such as Canadian Tire and have been slow to capitalize on e-commerce could face some serious competition from Amazon.com Inc. (Nasdaq:AMZN) with the launch online grocery and auto sales sites in Canada.
Today Amazon is launching www.amazon.ca/grocery and www.amazon.ca/auto.
The online grocery store will sell 15,000 non-perishable drygoods. The auto store will sell many of the products sold through Canadian Tire, such as accessories for cars, trucks, wheels and tires, and marine and RV products.
"With just a few clicks, customers can discover millions of items, take advantage of free shipping or free two-day shipping with Amazon Prime, and have items delivered to their doorstep," Amazon's country manager Alexandre Gagnon said in a release.
According to a Forrester white paper commissioned by Canada Post earlier this year, Canadians spent $21 billion online in 2012.
A recent BDC report finds that 84% of Canadians do online searches before making purchases and that 41% shop online. Of those Canadians who do shop online, 57% make their purchases from American e-commerce sites, and 43% in Canada.
The BDC report specifically warned that Canadian retailers that are slow to capitalize on online sales will face competition from the likes of Amazon.
"Historically, Canadian e-commerce has lagged behind that of most other nations, with some of the lowest penetration levels in the developed world," the report finds.
"Indeed, most Canadian brick-and-mortar stores remain reluctant to develop online retail channels. This situation has left the door wide open to foreign-owned retailers, such as Amazon, Apple, Walmart and Dell, which together represent 57% of all online sales by U.S. retailers in Canada in 2013."
According to the Forrester report, Canadian Tire, Holt Renfrew, Rona, and Shoppers Drug Mart are among the larger Canadian companies that have "limited or nonexistent" e-commerce capabilities.
